A company is considering reconfiguring an existing production line to produce medical gowns for healthcare professionals. To accelerate such development, the company has negotiated a total governmental grant of $110,000 received on two transactions: a receipt of $60,000 at the beginning and the remainder at the end of the first year. Only 60% of the total grant is payable back with an annual interest rate of 1% at the end of the third year. There are two alternatives (configurations) to create the mask production line. The company's real Minimum Attractive Rate of Return (MARR) is 9%. Average annual inflation rate is 1.50%. The properties of these investments are provided in the following table (all dollar values are estimated in today's dollars): Configuration 1 $180,000 Annual Maintenance cost $16,000/year Initial Cost Annual Sales Production unit cost Product unit sale price Salvage value after 5 years CCA Rate Service life Configuration 2 $255,000 $24,000/year 45,000 units/year 52,000 units/year $1.5/unit $3.25/unit $1.0/unit $3.25/unit $20,000 25% 3 years $40,000 25% 3 years For both alternatives, answer the following questions considering applicable taxes whenever possible: [a] Calculate the NPW of both alternatives taking into account all taxes at a tax rate of 36% (i.e., for after-tax cash flow). Half-year rule applies. [b] Which alternative is economically better