1. Your company is considering investing in an automation system for its production line, in order to have savings in salaries. Obtain the Net Cash Flow for this project, calculate its Net Present Value and Internal Rate of Return considering the following data: Cost of the automation system hardware: $250,000 Shipping cost of the hardware: $25,000 Cost of the automation system software: $75,000 Necessary adaptations to the facilities: $50,000 New operators needed: 3 Cost of initial training: $10,000 per operator Salaries of each of the new operators: $1,500 per month Salaries of each of the current workers: $1,000 per month Current workers that are not going to be needed any more: 10 Hiring costs of new operators: $500 per operator Firing costs of current workers: $1,000 per worker Electricity used by the system: 250 kWh per month Cost of electricity: $2.5 per kWh Maintenance cost of the system: $2,500 per year Useful life of the system: 10 years Salvage value: $50,000 MARR = 18% per year . Is this investment justified? 2. You are the manager of a sports team and want to know if hiring a super star player makes economic sense. One of your concerns is that the longer the player stays in your team, the more probable is that he gets an injury or loses its popularity, so you will only hire him if you recover your investment in 3 years or less. You will sign a 5 year contract with him, after which he will retire. With the following information obtain the Net Cash Flow, calculate the Net Present Value and the Discounted Payback Period. Use a MARR of 15% per year. Transfer fee to its current team: $80,000,000 Signing bonus to the player: $2,000,000 Player's salary: $8,000,000 per year Increase in annual revenues from TV rights: $20,000,000 Profits for each T-Shirt with his name: $100 Expected sales of T-Shirts with his name: 10,000 per month Increase in monthly revenues from sponsors: $600,000 Increase in the attendance to each local match: 10,000 people per match Local matches per year: 20 Average local matches ticket price: $24 . . Should you hire the player