Bramble Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows Click here to view PV tables. Machine A $243,000 8 years -0- $80,000 $35,000 Machine B $317,000 8 years -0- $95,000 $40,000 Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. (Round net present value to the

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
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Chapter1: Making Economics Decisions
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Bramble Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company
to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below.
Original cost
Estimated life
Salvage value
Estimated annual cash inflows
Estimated annual cash outflows
Click here to view PV tables.
Machine A
$243,000
8 years
-0-
$80,000
$35,000
Machine B
$317,000
8 years
-0-
$95,000
$40,000
Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. (Round net present value to the
Transcribed Image Text:Bramble Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows Click here to view PV tables. Machine A $243,000 8 years -0- $80,000 $35,000 Machine B $317,000 8 years -0- $95,000 $40,000 Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. (Round net present value to the
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