4) You are working on the development of a device to automate an inspection task. This will decrease labor costs. You have been asked to calculate the after tax cashflow each year for this investment. You have gathered the following data. Initial cost of the device is $300,000 which can be depreciated using MACRS 7-year recovery The project is evaluated over 5 years The device will be sold at the end of the 5 years for $30,000 Labor cost (including taxes and benefits) per unit will drop $5 (previous labor cost was $40/unit and now it will be $35/unit) The company makes 20,000 units per year. There will be increased maintenance costs of $20,000/year (previous maintenance costs were $106,000/yr and now they will be $86,000/yr) Tax rate is 28% yback (5 points) 5) For the project in problem number 4, what is the payback? Et Present Value (NPV) (5 points) 6) For the project in problem number 4, what is the NPV at 6% discount rate? Is this a good investment? ternal Rate of Return (IRR) (5 points) 7) For the project in problem number 4, what is the Internal Rate of Return? Is this a good investment if the MARR is 6%? nsitivity analysis (5 points) 8) For the project in problem number 4, what is the NPV (from problem 6) if the initial cost is $350,000? Is this still a good investment? 4) You are working on the development of a device to automate an inspection task. This will decrease labor costs. You have been asked to calculate the after tax cashflow each year for this investment. You have gathered the following data. Initial cost of the device is $300,000 which can be depreciated using MACRS 7-year recovery The project is evaluated over 5 years The device will be sold at the end of the 5 years for $30,000 Labor cost (including taxes and benefits) per unit will drop $5 (previous labor cost was $40/unit and now it will be $35/unit) The company makes 20,000 units per year. There will be increased maintenance costs of $20,000/year (previous maintenance costs were $106,000/yr and now they will be $86,000/yr) Tax rate is 28% yback (5 points) 5) For the project in problem number 4, what is the payback? Et Present Value (NPV) (5 points) 6) For the project in problem number 4, what is the NPV at 6% discount rate? Is this a good investment? ternal Rate of Return (IRR) (5 points) 7) For the project in problem number 4, what is the Internal Rate of Return? Is this a good investment if the MARR is 6%? nsitivity analysis (5 points) 8) For the project in problem number 4, what is the NPV (from problem 6) if the initial cost is $350,000? Is this still a good investment