OptiLux is considering investing in an automated manufacturing system. The system requires an initial investment of $4 million, has a 20-year life, and will have zero salvage value. If the system is implemented, the company will save $500,000 per year in direct labor costs. The company requires a 10% return from its investments. Using Excel, compute the internal rate of return for the proposed investment. Note: Round your answer to 2 decimal places. Internal rate of return %

OptiLux is considering investing in an automated manufacturing system. The system requires an initial investment of $4 million, has a 20-year life, and will have zero salvage value. If the system is implemented, the company will save $500,000 per year in direct labor costs. The company requires a 10% return from its investments. Using Excel, compute the internal rate of return for the proposed investment. Note: Round your answer to 2 decimal places. Internal rate of return %

Name: 10031. OptiLux is considering investing in an automated manufacturing
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Description: 10031. OptiLux is considering investing in an automated manufacturing system. The system requires aninitial investment of $4 million, has a 20-year life, and will have zero salvage value. If the system isimplemented, the company will save $500,000 pe

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter14: Real Options

Section: Chapter Questions

Problem 4MC

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