A company is considering a significant increase in the automation of its Management Information System. The hardware for the system would require an initial outlay of $3,000,000. Software and staff training costs would cost $1,000,000 per year for the first two years of operation and $200,000 per year after for the next three years. After 5 years the system would be due for replacement. The company does not believe the equipment will have any value at the end of the 5 year period. Whilst scrapping the current system will not provide any immediate cash flow, operating costs would decrease by $1,500,000 per year. The company would use a combination of debt and equity finance to pay for the new system, using its current debt to equity ratio of 25% debt to 75% equity. The companys borrowing cost is 8% per annum, and its tax rate is 30%. The company has a cost of equity capital of 12%. Required 1. Determine the Net Present Value of the proposed investment using the Weighted Average Cost of Capital. 2. Should the company undertake it