a. What is the NPV of this project?

• $268,825.67
• $260,760.90
• $255,384.38
• $282,266.95
• $276,890.44

b. What is the NPV if the pretax cost savings are $412,600 per year?

• $-107,490.28
• $-104,265.57
• $-102,115.76
• $-102,115.76
• $-110,714.99

At what level of pretax cost savings would you be indifferent between accepting the project and not accepting it?

• $458,430.68
• $416,898.01
• $50,616.05
• $481,352.21
• $435,509.14

Your firm is contemplating the purchase of a new $1,461,500 computer-based order entry system. The system will be depreciated straight-line to zero over its 5 -year life. It will be worth $142,200 at the end of that time. You will be able to reduce working capital by $197,500 (this is a one-time reduction). The tax rate is 25 percent and your required return on the project is 18 percent and your pretax cost savings are $573,050 per year