Intro The local franchise of Jiffy Lube is thinking of buying a new lif for $50,000 that would make it easier to access the oil filter in customers' cars and save labor. The savings would increase over the project's 3-year life, in line with the projected growth of the business B D 1 Year 1 2 3 2 Cost savings 40,000 44,000 52,800 The machine is to be linearly depreciated to zero and will have no resale value after 3 years. The company uses a discount rate of 14% and has a tax rate of 21% IB Attempt 1/10 for 10 pts Part 1 What is the free cash flow in year 3? Correct B D E 1 Discount rate 0.14 2 Tax rate 0.21 3 Cost of machine 50,000 4 5 Year 1 2 3 6 Cost savings 40,000 44,000 52.800 7 Depreciation -16,667 -16,667 -16,667 - $83/3 8 EBIT 23,333 27,333 36.133-06-07 9 Taxes (21%) 4,900 -5,740 -7.588 =D8 $B2 10 Depreciation 16,667 16,667 16,667-07 11 FCF 35,100 38,260 45,212 SUMDB:D10) Part 2 EB Attempt 4/10 for 8 pts What is the NPV? 0+ decimals Submit