Problem
A firm is about to begin pilot plant operation on a process it has developed. One item of optional equipment that could be obtained is a heat exchanger unit. The company finds that a unit now available for $30,000 could be used in other company operations. It is estimated that the heat exchanger unit wl be worth $35,000 at the end of eight years. This seemingly high salvage value is due primarily to the fact that the $30,000 purchase price is really a rare bargain. If the firm believes 15% is an acceptable rate of return, what annual benefit is needed to justify the purchase the heat exchanger unit?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.