EGG is a life coaching and fitness coaching firm. They are considering an investment in a customer relationship management platform. The project involves $225,000 in first costs and is expected to generate net savings (in actual dollars) of $65,000 per year over its 5-year life. They forecast. A. EGG wants to buy a walk-in humidor in 5 years. How much money does EGG have to deposit in an investment account each year if their account earns 12% and they will see a price inflation of 8% per year? It currently costs $680.58. B. If inflation were 0% then how much do they have to save per year to be able to buy the humidor in 5 years?
EGG is a life coaching and fitness coaching firm. They are considering an investment in a customer relationship management platform. The project involves $225,000 in first costs and is expected to generate net savings (in actual dollars) of $65,000 per year over its 5-year life. They forecast. A. EGG wants to buy a walk-in humidor in 5 years. How much money does EGG have to deposit in an investment account each year if their account earns 12% and they will see a price inflation of 8% per year? It currently costs $680.58. B. If inflation were 0% then how much do they have to save per year to be able to buy the humidor in 5 years?
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 1PA: Your company is planning to purchase a new log splitter for is lawn and garden business. The new...
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EGG is a life coaching and fitness coaching firm. They are considering an investment in a customer relationship management platform. The project involves $225,000 in first costs and is expected to generate net savings (in actual dollars) of $65,000 per year over its 5-year life. They
A. EGG wants to buy a walk-in humidor in 5 years. How much money does EGG have to deposit in an investment account each year if their account earns 12% and they will see a price inflation of 8% per year? It currently costs $680.58.
B. If inflation were 0% then how much do they have to save per year to be able to buy the humidor in 5 years?
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