40. A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firms production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $25,464.00 per year for 8 years and costs $104,721.00. The UGA-3000 produces incremental cash flows of $27,123.00 per year for 9 years and cost $124,901.00. The firms WACC is 7.18%. What is the equivalent annual annuity of the GSU-3300? Assume that there are no taxes.

correct answer is 7804.08. show steps with a financial calculator.

39. Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $13.00 million fully installed and will be fully depreciated over a 15 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $2.94 million per year and increased operating costs of $702,716.00 per year. Caspian Sea Drinks' marginal tax rate is 20.00%. The internal rate of return for the RGM-7000 is _____.

correct answer is 12.5314%. show steps with financial calculato