Price Corp. is considering the purchase of a new machine tool to replace an obsolete one. The machine will have to be replaced at the end of 15 years. Price's cost of capital is 10 percent. The tax rate is 50 percent.
Price uses straight-line depreciation.
Slide 21 of 27 Price Corp. is considering the purchase of a new machine tool to replace an obsolete one. The machine will have to be replaced at the end of 15 years. Price's cost of capital is 10 percent. The tax rate is 50 percent. Price uses straight-line depreciation.