EXERCISE $13-3$ Uncertain Future Cash Flows $[$L$03]$

Union Bay Plastics is investigating the purchase of automated equipment that would save $$100,000$ each year in direct labor and inventory carrying costs. This equipment costs $$750,000$ and is expected to have a $10-$year useful life with no salvage value. The company's required rate of return is $15\%$ on all equipment purchases. This equipment would provide intangible benefits such as greater flexibility and higher$-$quality output that are difficult to estimate and yet are quite significant.

Required:

$($Ignore income taxes.$)$

What dollar value per year would the intangible benefits have to have in order to make the equipment an acceptable investment?