Joe Vandelay buys a piece of equipment for $200,000. He puts down $40,000 and finances $160,000 from a local bank. Joe s opportunity cost is 5%, and the bank charges 10% on the loan. The after-tax cash flows generated from the equipment are $54,000 per year for the next 5 years.

Should Joe buy the equipment based on the NPV rule?

	a.	Yes as NPV is $10,041.17.
	b.	Yes as NPV is -$12,163.39.
	c.	No as NPV is $8,952.28.
	d.	No as NPV is -$14,234.46.