Question

real-time Incorporated considers purchase of a new machine that cost $40,000 and requires an increase in net operating working capital of 2,000 and the time of purchase what is the net investment required at T equals zero

Answer 1

Answer: $42,000

Explanation:

The Net investment required is the total amount that a company needs to initiate a project or acquire an asset.

Net investment at time 0 = Cost of machine + increase in net operating capital

= 40,000 + 2,000

= $42,000