A firm is considering an investment in a new machine with a price of $

$18\mathrm{.}03$

$$million to

replace its existing machine. The current machine has a book value of $

$6\mathrm{.}03$

$$million$,$ and

a market value of $

$4\mathrm{.}53$

$$million$.$ The new machine is expected to have a four

$-$

year life,

and the old machine has four years left in which it can be used. If the firm replaces the

old machine with the new machine, it expects to save $

$6\mathrm{.}73$

$$million in operating costs

each year over the next four years. Both machines will have no salvage value in four

years. If the firm purchases the new machine, it will also need an investment of

$

$253$

$,$

$000$

$$in net working capital. The required return on the investment is

$10$

$$percent and

the tax rate is

$23$

$$percent$.$

a

$.$

$$What is the NPV of the decision to purchase a new machine?

$($

Do not round

intermediate calculations and enter your answer in dollars, not millions of dollars,

rounded to

$2$

$$decimal places, e

$.$

g

$.$

$,$

$1$

$,$

$234$

$,$

$567\mathrm{.}89$

$.$

$)$

b

$.$

$$What is the IRR of the decision to purchase a new machine?

$($

Do not round

intermediate calculations and enter your answer as a percent rounded to

$2$

$$decimal

places, e

$.$

g

$.$

$,$

$32\mathrm{.}16$

$.$

$)$

c

$.$

$$What is the NPV of the decision to purchase the old machine?

$($

A negative answer

should be indicated by a minus sign. Enter your answer in dollars, not millions of

dollars. Do not round intermediate calculations and round your answer to

$2$

$$decimal

places, e

$.$

g

$.$

$,$

$1$

$,$

$234$

$,$

$567\mathrm{.}89$

$.$

$)$

d

$.$

$$What is the IRR of the decision to purchase the old machine?

$($

A negative answer

should be indicated by a minus sign. Do not round intermediate calculations and

enter your answer as a percent rounded to

$2$

$$decimal places, e

$.$

g