Multiple Choice
Fergus Company is considering the purchase of a machine that will save the company $4,000 per year in operating costs for a period of seven years.The most it should pay for the machine is equal to
A) $4,000 times the present value of an ordinary annuity for 7 periods.
B) $28,000.
C) $4,000 divided by the future value of a single sum at the end of 7 periods.
D) $4,000 times the future value of an ordinary annuity for 7 periods.
Correct Answer:
Verified
Correct Answer:
Verified
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