d) A university student painter is considering the purchase of a paint sprayer to replace an old one. The new paint sprayer costs $12,000 and has a useful life of four years, at which time it can be sold for $1,600. The old paint sprayer can be sold now for $500 and could be scrapped for $250 in four years. The student believes that operating revenues will increase annually by $8,000. The tax rate is 22% and the required rate of return is 15% and the PV of CCATS is estimated at $1,372. What is the NPV of buying a new sprayer? Should the student replace the old sprayer? Explain. (use below table in your answer) Years 0 Initial Investment Salvage Value Sale of old equipment Opportunity cost Total Capital Spending Increase in Revenues Taxes After-tax Operating Cash Flow Total Capital Spending & after tax OCF PV of CF PVCCAT 1,372 NPV Should the student accept or reject the project? Explain