Jensen Co. has additional funds available for investment, and is considering purchasing an asset that is expected to provide an after-tax cash inflow of $45,000 per year for the next 7 years, with an after-tax disposal value of $10,000. Jensen Co.'s required rate of return is 11%.
What is the maximum amount that Jensen Co. would be willing to pay to purchase this asset? (Use a financial spreadsheet or a financial calculator to answer this question.)

Question

Jensen Co. has additional funds available for investment, and is considering purchasing an asset that is expected to provide an after-tax cash inflow of $45,000 per year for the next 7 years, with an after-tax disposal value of $10,000. Jensen Co.'s required rate of return is 11%. 
What is the maximum amount that Jensen Co. would be willing to pay to purchase this asset? (Use a financial spreadsheet or a financial calculator to answer this question.)

Quizplus · Accepted Answer

The Answer of Jensen Co. has additional funds available for investment, and is considering purchasing an asset that is expected to provide an after-tax cash inflow of $45,000 per year for the next 7 years, with an after-tax disposal value of $10,000. Jensen Co.'s required rate of return is 11%. 
What is the maximum amount that Jensen Co. would be willing to pay to purchase this asset? (Use a financial spreadsheet or a financial calculator to answer this question.)

Jensen Co Has Additional Funds Available for Investment, and Is Considering