DR
BT
8
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Week
8
Quiz
(Ch
16
-
Part
2)
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computing
technology
to
reduce
current
operating
costs.
The
new
computing
technology
will
have
a
five-year
life
with
no
salvage
value
at
the
end
of
five
years.
Advanced
Digital
Design’s
cost
of
capital
is
12%.
Relevant
cash
flows
and
present
value
factors
for
5
years
@
12%
are
as
follows:
5
.~
Advanced
Digital
Design
is
analyzing
a
capital
investment
project
for
using
new
Investment
in
computer
technology
=
$500,000.
Annual
net
cash
savings
from
new
computer
technology
=
$135,000.
Salvage
value
of
new
computer
technology
=
$0.
Present
value
of
$1=0.5674
Present
value
of
an
annuity
of
$1
=
3.6048
When
considering
the
net
present
value
of
the
investment
in
new
computing
technology,
which
one
of
the
following
represents
a
possible
internal
rate
of
return
on
the
investment?
Multiple
Choice
None
of
the
answers
are
possible.
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