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fou must evaluate the purchase of a proposed spectrometer for the RsD department. The purchase price of the spectrometwi icicuding modifications is $270,000, and the

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fou must evaluate the purchase of a proposed spectrometer for the RsD department. The purchase price of the spectrometwi icicuding modifications is $270,000, and the equipment will be fully depreciated at the time of purchase. The equipment would be sold after 3 years for $92,000. The equipment would require a $15,000 increase in ret operating working capital (spare parts inventory). The project would have no effect on revenues, but it should save the firm $78,000 per year in before-tax labor costs. The firm's marginal federalplus-state tax rate is 25%. a. What is the initial investment outlay for the spectrometer, that is, what is the Year 0 project cash flow? Enter your answer as a positive walue. Round youe answer to the nearest dollas. b. What are the orolect's annual cash flows in Years-1, 2, and 37 Do not round intermediate calculations. Round your answers to the nearest dollar. Year 1+5 Year 2:5 Year 3: $ c. If the wacc is 10%, should the spectrometer be purchased

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