Explore BrainMass

Explore BrainMass

    Investment Timing: Purchasing an Optical Scanner

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    You can purchase an optical scanner today for $400. The scanner provides benefits worth $60 a year. The expected life of the scanner is 10 years. Scanners are expected to decrease in price by 20 percent per year. Suppose the discount rate is 10 percent. Should you purchase the scanner today or wait to purchase? When is the best purchase time?

    © BrainMass Inc. brainmass.com June 3, 2020, 10:45 pm ad1c9bdddf

    Solution Preview

    Please see the attached Excel sheet for the full solution.

    I must wait to purchase. If I purchase today, my net worth will decrease by $31.33 which is equal to the ...

    Solution Summary

    It is determined whether a new optical scanner should be invested in. The expert examines purchasing an optical scanner.