LCH manufactures product X which it sells for 5 per unit. Unit variable production cost is currently 3 per unit. A new machine is available which would cost 90,000 but which could be used to make product X for an estimated unit variable cost of only 2.50. Fixed production costs, however, would increase by 7,500 per annum as a direct result of purchasing the machine. The machine would have an expected life of four years and a resale value at the end of its life of 10,000. Sales of product X are estimated to be 75,000 units annually over the four years. LCH expects to earn at least 12% annually from its investments. Ignore taxation. Required: a) If LCH expects to earn at least a 12% return from its investments, estimate the NPV of the new machine. b) Use your result above to decide whether or not the new machine should be purchased