Paige Company is contemplating the acquisition of a machine that costs $50,000 and promises to reduce annual cash operating costs by $11,000 over each of the next six years.Which of the following is a proper way to evaluate this investment if the company desires a 12% return on all investments?
A) $50,000 vs.$11,000 * 6.
B) $50,000 vs.$66,000 * 0.507.
C) $50,000 vs.$66,000 * 4.111.
D) $50,000 vs.$11,000 *4.111.
E) $50,000 * 0.893 vs.$11,000 *4.111.
Correct Answer:
Verified
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