(Ignore income taxes in this problem) The management of Enamorado Corporation is investigating buying a small used aircraft to use in making airborne inspections of its above-ground pipelines. The aircraft would have a useful life of 5 years. The company uses a discount rate of 17% in its capital budgeting. The net present value of the investment, excluding the intangible benefits, is -$160,462. To the nearest whole dollar how large would the annual intangible benefit have to be to make the investment in the aircraft financially attractive?

Question

Quizplus · Accepted Answer

The Answer of (Ignore income taxes in this problem) The management of Enamorado Corporation is investigating buying a small used aircraft to use in making airborne inspections of its above-ground pipelines. The aircraft would have a useful life of 5 years. The company uses a discount rate of 17% in its capital budgeting. The net present value of the investment, excluding the intangible benefits, is -$160,462. To the nearest whole dollar how large would the annual intangible benefit have to be to make the investment in the aircraft financially attractive?

(Ignore Income Taxes in This Problem) the Management of Enamorado