Should raphael make the purchase


Question:

Raphael Restaurant is considering the purchase of a $10,000 souffle maker. the souffle maker has an economic life of 5 years and will be fully depreciated by the straight-line method. The machine will produce 2000 souffles per year, with each costing $2 to make and priced at $5. Using excel, assume that the discount rate is 17 percent and the tax rate is 34 percent. Should Raphael make the purchase?

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Finance Basics: Should raphael make the purchase
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