a$.$ What is the initial investment outlay for the spectrometer, that is$,$ what is the Year $0$ project cash flow? Round your answer to the nearest cent. Negative amount should be indicated by a minus sign.

$

b$.$ What are the project's annual cash flows in Years $1,2,$ and $3?$ Round your answers to the nearest cent.

In Year $1$$ $$

In Year $2$$ $$

In Year $3$$ $$

If the WACC is $10\%,$ should the spectrometer be purchased?

$$

Excel Online Structured Activity: New project analysis

You must evaluate the purchase of a proposed spectrometer for the R&D department. The base price is $$190,000,$ and it would cost another $$47,500$ to modify the equipment for special use by the firm. The equipment falls into the MACRS $3-$year class and would be sold after $3$ years for $$66,500.$ The applicable depreciation rates are $33\%,45\%,15\%,$ and $7\%.$ The equipment would require an $$6,000$ increase in net operating working capital $($spare parts inventory$).$ The project would have no effect on revenues, but it should save the firm $$52,000$ per year in before$-$tax labor costs. The firm's marginal federal$-$plus$-$state tax rate is $40\%.$ The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below.

$\backslash$table$[[\backslash$table$[[1],[2]],,,,,],[3.,$Base price,$$190,000,,,],[4,$Addiconal modification costs,$547500,,,],[5,$Before tax salvage proceeds,$566,500,,,],[6),$Change in NOWC,$56,000,,,],[7.,$Before$-$tax labor cost saving:,$$52,000,,,],[8,$WhOC,$10\mathrm{.}00\%,,,],[9||,$Tax raie,$40\mathrm{.}00\%,,,],[10,,,,,],[11.,,$Yr$\mathrm{.}0,Y_{r.}1,$Yr$.2,Yr-3$