1Real investment decision Hansen Investors, Inc. is considering the purchase of a $400,000 super computer with an economic life of five years. The computer will be fully depreciated over five years using the straight-line method. The market value of the computer will be S60,000 in five years. The computer will replace ive oi alaries are $100,000. The machine will also immediately lower the firm's required net working capital by $50,000. This amount of net working capital will need to be replaced once the machine is sold. The corporate tax rate is 35 percent. Is it worthwhile to buy the computer if the appropriate discount rate is 10 percent? ffice employees whose combined annual s 2.Real Investment decision Halliburton is considering an investment in a new machine with a price of $20 million to replace its existing machine. The current machine has a book value of S8 million and a market value of $5 million. The new machine is expected to have a four-year life, and the old machine has four years left in which it can be used. If the firm replaces the old machine with the new machine, it expects to save $7.2 million in operating costs each year over the next four years. Both machines will have no salvage value in four years. If the firm purchases the new machine, it will also need an investment of $300,000 in net working capital. The required return on the investment is 10 percent, and the tax rate is 35 percent. What are the NPV and IRR of the decision to replace the old machine