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Business, 13.04.2021 02:30 Korey5672

A company is considering constructing a plant to manufacture a proposed new product. The land costs ​$250 comma 000​, the building costs ​$700 comma 000​, the equipment costs ​$300 comma 000​, and ​$150 comma 000 additional working capital is required. It is expected that the product will result in sales of ​$850 comma 000 per year for 11 ​years, at which time the land can be sold for ​$450 comma 000​, the building for ​$300 comma 000​, and the equipment for ​$60 comma 000. All of the working capital would be recovered at the EOY 11. The annual expenses for​ labor, materials, and all other items are estimated to total $500,000. If the company requires a MARR of 15% per year on projects of comparable risk, determine if it should invest in the new product line. Use the AW method.

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A company is considering constructing a plant to manufacture a proposed new product. The land costs...
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