4. The Render Instrument Corporation is considering replacing the wood steamer it currently uses to shape guitar sides. The steamer has 6 years of remaining life. If kept, the steamer will have depreciation expenses of $650 for the next 6 years. Its current book value is $3,550 and it can be sold on an auction website for S4,150 at this time. If the old steamer is not replaced, it can be sold for $800 at the end of its useful life. Render is contemplating purchasing the Awe Steamer 2000, a higher-end steamer, which costs $12,000 and has an estimated useful life of 6 years with an estimated salvage value of $1,500. The steamer falls into the MACRS 5-year class (so the applicable depreciation percentages are 20.00%, 32.00%, 19.20%, 11.52%, 11.52% and 5.76%). The new steamer is faster and allows for an output expansion, so sales would rise by $2,000 per year. In addition, the new machine's much greater efficiency would reduce operating expenses by $1,900 per year. To support the greater sales, the new machine would require that inventories increase by $2,900, but accounts payable would increase simultaneously by $700. Sender's marginal federal-plus-state tax rate is 25% and its required rate of return is 15%. a. What is the net investment in the replacement asset? b. Calculate the annual change in depreciation between the new versus old machine if the replacement is made. c. What are the incremental operating cash inflows for years 1 through 6? d. What is the terminal cash flow in year 6? e. Calculate the NPV of the replacement asset. Should the firm go ahead with the replacement