Problem
Installing an automated production system costing $278,000 is initially expected to save Zia Corporation $52,000 in expenses annually. If the system needs $5000 in operating and maintenance costs each year and has a salvage value of $25,000 at Year 10, what is the IRR of this system? If the company wants to earn at least 12% on all investments, should this system be purchased? Contributed by Paul R. McCright, University of South Florida.
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.