5-4. Suppose that you have just completed the mechanical design of a high-speed automated palletizer that has an investment cost of $8,000,000. The existing palletizer is quite old and has no salvage value. The market value for the new palletizer is estimated to be $500,000 after eight years. Two million pallets will be handled by the palletizer each year during the seven-year expected project life. What net savings per pallet (i.e., total savings less expenses) will have to be generated by the palletizer to justify this purchase in view of a MARR of 15% per year?

(5.3)