Caspian Sea Drinks is considering the purchase of a plum juicer the PJX5. There is no planned increase in production. The PJX5 will reduce costs by squeezing more juice from each plum and doing so in a more efficient manner. Mr. Bensen gave Derek the following information. What is the IRR of the PJX5?

a. The PJX5 will cost $2.16 million fully installed and has a 10 year life. It will be depreciated to a book value of $197,903.00 and sold for that amount in year 10.

b. The Engineering Department spent $44,218.00 researching the various juicers.

c. Portions of the plant floor have been redesigned to accommodate the juicer at a cost of $18,179.00.

d. The PJX5 will reduce operating costs by $442,383.00 per year.

e. CSDs marginal tax rate is 36.00%.

f. CSD is 74.00% equity-financed.

g. CSDs 15.00-year, semi-annual pay, 5.52% coupon bond sells for $972.00.

h. CSDs stock currently has a market value of $24.96 and Mr. Bensen believes the market estimates that dividends will grow at 2.66% forever. Next years dividend is projected to be $1.54.

Submit Answer format: Percentage Round to: 2 decimal places (Example: 9.24%, % sign required. Will accept decimal format rounded to 4 decimal places (ex: 0.0924))

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#20 Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $15.00 million fully installed and will be fully depreciated over a 20 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $3.67 million per year and increased operating costs of $579,799.00 per year. Caspian Sea Drinks' marginal tax rate is 20.00%. If Caspian Sea Drinks uses a 12.00% discount rate, then the net present value of the RGM-7000 is ___.

Submit Answer format: Currency: Round to: 2 decimal places.