MKM International is seeking to purchase a new CNC machine in order to reduce costs. Two alternative machines are in consideration Machine 1 costs $500,000 but yields a 10 percent savings (net benefit) over the current machine used. Machine 2 costs $900,000 but yields a 20 percent savings (net benefit) over the current machine used. In order to meet demand, the following forecasted cost information for the current machine is also provided. Year 1 2 3 4 5 Projected Cost 1,000,000 1,350,000 1,400,000 1,450,000 2,550,000 a) Based on the NPV of the cash flows for these five years, which machine should MKM International Purchase? Assume a discount rate of 12 percent. MKM International is seeking to purchase a new CNC machine in order to reduce costs. Two alternative machines are in consideration. Machine 1 costs $500,000 but yields a 10 percent savings (net benefit) over the current machine used. Machine 2 costs $900,000 but yields a 20 percent savings (net benefit) over the current machine used. In order to meet demand, the following forecasted cost information for the current machine is also provided. Year 1 2 3 4 5 Projected Cost 1,000,000 1,350,000 1,400,000 1,450,000 2,550,000 a) Based on the NPV of the cash flows for these five years, which machine should MKM International Purchase? Assume a discount rate of 12 percent Machine 1 option: Year Cash Flow 1 2 3 4 5 NPV- 300100.14