3. Hiawatha 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 $200,000. The equipment will have an initial cost of $900,000 and have a 6 year life. There is no salvage value for the equipment. If the cost of capital is 9%, what is the approximate net present value? Ignore income taxes. A. $53,300 B. $2,820 C. $900,000 D. $700,000 4. Peet's 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 $120,000. The equipment will have an initial cost of $500,000 and have a 5 year life. If the salvage value of the equipment is estimated to be $75,000, what is the accounting rate of return? Ignore income taxes. A. 7.0% B. 8.75% C. 30.00% D. 13.75% 5. An investment of $36,048 promises to return $10,000 each year for the next 5 years. If taxes are ignored, what is the internal rate of return? Round to 4 decimal places A. B. c. D. 6% 12% 8% more than 12% 6. Stone, Inc. is considering three different independent investment opportunities. The present value of future cash flows, initial investment, and net present value for each of the projects are as follows: Project A Project B Project C Present value of $300,000 $250,000 $275,000 future cash flows Initial investment 150,000 105,000 140,000 Net present value $150,000 $145,000 $135,000 Profitability Index In what order should Stone prioritize investment in the projects? A. A, C, B B. B, C, A C. B, A,C D. A, B, C