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Financial Problem: Figuring the Net Investment (NINV)

What is the net investment for an extruder that costs $42,000, if shipping costs are $1,500 and installation is $4,800? Assume this efficient machine is replacing an older extruder with a book and market value of zero. The replacement investment will reduce operating costs by $6,600 a year.

The following choice are:
a. $48,300
b. $54,900
c. $43,500
d. None of the above

Solution Summary

Net investment is determined. The response received a rating of "5" from the student who posted the question.