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1 #1 Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000,

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1 #1 Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $14.00 million fully installed and will be fully depreciated over a 15.00 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $2.56 million per year and increased operating costs of S685,827.00 per year. Caspian Sea Drinks" marginal tax rate is 23.00%. The incremental cash flows for produced by the RGM-7000 are Submit Answer format: Currency: Round to: 2 decimal places. 2 #2 Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $14.00 million fully installed and will be fully depreciated over a 15 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $2.54 million per year and increased operating costs of S663,076.00 per year. Caspian Sea Drinks' marginal tax rate is 24.00%. The internal rate of return for the RGM-7000 is Submit Answer format: Percentage Round to: 4 decimal places (Example: 9.2434%, % sign required. Will accept decimal format rounded to 6 decimal places (ex: 0.092434)) #3 Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $14.00 million fully installed and will be fully depreciated over a 20 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $2.58 million per year and increased operating costs of $548,521.00 per year. Caspian Sea Drinks" marginal tax rate is 33.00%. If Caspian Sea Drinks uses a 12.00% discount rate, then the net present value of the RGM-7000 is Submit Answer format: Currency: Round to: 2 decimal places. . #4 Caspian Sea Drinks" is financed with 60.00% equity and the remainder in debt. They have 11.00-year, semi-annual pay, 5.18% coupon bonds which sell for 97.90% of par. Their stock currently has a market value of $24.56 and Mr. Bensen believes the market estimates that dividends will grow at 3.92% forever. Next year's dividend is projected to be $2.90. Assuming a marginal tax rate of 31.00%, what is their WACC (weighted average cost of capital)

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