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[15 points] Burton, a manufacturer of snowboards, is considering replacing an existing piece of equipment with a more sophisticated machine. The cash flows for this

[15 points] Burton, a manufacturer of snowboards, is considering replacing an existing piece of equipment with a more sophisticated machine. The cash flows for this capital investment are provided below. Burton uses a WACC of 14%.

Year

0

1

2

3

Cash Flows

-$139,811

$65,419.50

-$2,373.50

$115,738

A. Find the Discounted Payback period, NPV, IRR, and MIRR.

B. Should the new machine be purchased? Why or why not?

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