different questions

Company X has an opportunity to upgrade a piece of equipment at a cost of $430,000. The new equipment is expected to generate the following cash flows: Year 1 $140,000 Year 2 $150,000 Year 3 $50,000 Year 4 $80,000 Year 5 $75,000 Year 6 $50,000 Company X assumes a hurdle rate of 10% Company X's manager believes there will be an ability to refurbish the equipment at the end of the equipment's 6-year to. The refurbishment is expected to add one year of useful life to the equipment and will cost $60,000. If the equipment is not refurbished, the salvage value will be $0 at the end of year 6. If the equipment is refurbished, the salvage value will be $50.000 at the end of year 7. What is the additional NPV of just the refurbishment, assuming the cash inflow in year 7 is $70,000? $27.720 $51.560 $18.000 52.070 Company X is thinking about purchasing a new milling tool that would cost $358,000. The milling tool is unlikely to have a salvage value and will be useful for 5 year The cash flows that would be produced by the milling tool are: Year Cash Inflows Yr 1 $147.000 Yr 2 $ 150,000 Yr3 $ 181,000 Yr 4 $147,000 Yr 5 $ 149,000 The payback period of this investment is closest to: 0 0.0 years 3 years 2.3 years 0 4.7 years 3.3 years