Suppose we are thinking about replacing an old computer with a new one. The old one...

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Suppose we are thinking about replacing an old computer with a new one. The old one cost us $1740,000; the new one will cost,

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Cost savings Less: Depreciation Profit before tax Less: Tax @ 24% Net income Add: Depreciation Operating cash flows - New $36

Year New 0 $ (2,105,000) 1 $ 378,440 2 $ 378,440 3 $ 378,440 4 $ 378,440 5 $ 754,640 PVIF@9% 1.000 0.917 0.842 0.772 0.708 0.

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