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 $1.68 million fully installed and has a 10 year life. It will be depreciated to a book value of

$251 513 00 and sold for that amount in vear 10.

1. The Engineering Department spent $39,056.00 researching the various juicers.
2. Portions of the plant floor have been redesigned to accommodate the juicer at a cost of $20,218.00.
3. The PJX5 will reduce operating costs by $377,499.00 per year.
4. CSD's marginal tax rate is 33.00%
5. CSD is 59.00% equity-financed.
6. CSD's 19.00-year, semi-annual pay, 5.03% coupon bond sells for $995.00.
7. CSD's stock currently has a market value of $23.33 and Mr. Bensen believes the market estimates that dividends will grow at 3.86% forever. Next year's dividend is projected to be $1.76

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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)