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Your company buys a piece of equipment for $10,000 which has a 10 year service life,...

Your company buys a piece of equipment for $10,000 which has a 10 year service life, $1000 per year maintenance cost starting 1 year after purchase and through the service life of the equipment. The cost of capital for your company is 4%. The salvage value is $2,000. What is the NPV for this piece of equipment?
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Answer #1

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-0 $10,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,00

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