Solved: Spiro Hospital is investigating the possibility of investing in new

Solved: Spiro Hospital is investigating the possibility of investing in new
Spiro Hospital is investigating the possibility of investing in new dialysis equipment. Two localmanufacturers of this equipment are being considered as sources of the equipment. After-taxcash inflows for the two competing projects are as follows: Both projects require an initial investment of $560,000. In both cases, assume that the equipmenthas a life of 5 years with no salvage value. Required: 1. Assuming a discount rate of 12%, compute the net present value of each piece of equipment.2. A third option has surfaced for equipment purchased from an out-of-state supplier. The costis also $560,000, but this equipment will produce even cash flows over its 5-year life. Whatmust the annual cash flow be for this equipment to be selected over the other two? Assume a12% discount rate.
Solved: Spiro Hospital is investigating the possibility of investing in new