What to pay for the new computer system


Anthony operates a part time auto repair service. He estimates that a new diagnostic computer system will result in increased  cash inflows of $1,500 in Year 1, $2,100 in Year 2, and $3,200 in Year 3. If Anthony"s required rate of return is 10%, then the most he would be willing to pay for the new computer system would be:

A) $4,599

B) $5,501

C) $5,638

D) $5,107

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Finance Basics: What to pay for the new computer system
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