37. (Multiple methods) Toys for Big Boys is considering purchasing a robot to apply shrink wrap packaging to some of its products. The robot will cost

$2,300,000 and will produce annual labor and quality cost savings of $300,000.

The robot is expected to last 11 years and have no salvage value. For this project answer the following questions.

a. What is the payback period (ignore tax)?

b. If Toys for Big Boys’ discount rate is 10 percent, what is the net present value (ignore tax)?

c. Using a 10 percent discount rate, what is the profitability index (ignore tax)?

d. What is the internal rate of return (to the nearest percent) (ignore tax)?