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    Determine the net present worth for Hollingsworth Machine Group

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    Hollingsworth Machine Group needs a new precision grinding wheel. If 12% is the acceptable return for Hollingsworth, determine the net present worth of one of the best alternatives.

    Cost =$80,000
    Useful life = 5 years
    Annual Cost=$12,000
    Salvage Value=$10,000

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    Solution Preview

    Current Cash Flow=CFo=-80000

    Cash Flow at the end of year 1=CF1=-12000

    Cash Flow at the end of year 2=CF2=-12000

    Cash Flow at ...

    Solution Summary

    Solution depicts the steps to estimate the present worth of the given example of Hollingsworth Machine Group.