Clearwater Inc. produces watercoolers for residential and commercial use. Theyve been in business for 15 years and are in the process of evaluating whether or not to proceed with a purchase of a new piece of equipment that produces a component for their water coolers. They have a choice before them to either refurbish their existing equipment or purchase a new piece of equipment. The refurbish option has the following cash flows. Itll cost $300,000 immediately to continue using the current equipment. It will also cost an additional $330,000 to refurbish the equipment again in 5 years time. The refurbished equipment will be able to generate $100,000 in cash inflows for 10 years. It will not have any salvage value at the end of 10 years. The other option is purchasing a new piece of equipment costing $750,000 now. This option would allow the company to sell the old equipment now for $75,000. The new equipment wouldnt need to be refurbished for 6 years and will only cost $200,000 to refurbish at that time. The new equipment will generate $150,000 in cash inflows per year. The equipment will have a salvage value of $125,000 at the end of 10 years. The firm has a capital structure of 60% equity (from an investor who requires a 20% return) and 40% debt (from a lender who requires a 10% return). Disregard the effects of taxes in calculating your Weighted Average Cost of Capital. calculate the NPV of each project as well as the payback period and the discounted payback period. In addition to that the lender has expressed interest in potentially funding either project completely. If the lender would provide funds at a rate of 10% (rather than the WACC). Calculate NPV, payback period and discounted payback period if the lender provided all funding.