1. Bluebell Corp is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $100,000. The equipment will have an initial cost of $600,000 and have an 8 year life. The no equipment has no salvage value. The hurdle rate is 8%. Ignore income taxes. Answer the following: Saiva ge a. What is the accounting rate of return? Valve ARR = Net Income Cash How Investment 100 000 - 157008 Depreciation/ Ex pens b. What is the payback period? 600, D0 0 14 . 167 .1. 606,000 - OX Payback = Investment 600 000 8yrs annual cash flow 160, 050 - -7 how long it will take to pay buck the investment c. What is the net present value (NPV)? original investment / 600, co 07 ->