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Because of the COVID pandemic, the board of education for the Matalino School District is considering the acquisition of several minibuses for use in transporting students to school. Six of the school district's bus routes are underpopulated, with the result that the full-size buses on those routes are not fully utilized. After a careful study, the board has decided that it is not feasible to consolidate these routes into fewer routes served by full-size buses. The area in which the students live is too large for that approach since some students' bus ride to school would exceed the state maximum of 50 minutes. The plan under consideration by the board is to replace six full-size buses with nine minibuses, each of which would cover a much shorter route than a full-size bus, avoiding longer contact among the students. The bus drivers in this rural school district are volunteer retired parents whose token for services costs the school district PHP19,000 per year for each driver. In addition to the drivers' cash token, the annual costs of operating and maintaining a full-size bus amount to PHP60,000. In contrast, the board projects that a minibus will cost only PHP30,000 annually to operate and maintain. The school district controller has estimated that it will cost the district PHP25,134, initially, to redesign its bus routes, inform the public, install caution signs in certain hazardous locations, and retrain its drivers. A minibus costs PHP27,000, whereas full-size bus costs PHP100,000. The school district uses straight-line depreciation for all of its long-lived assets. The board has two options regarding the six full-size buses. First, the buses could be sold now for PHP16,000 each. Second, the buses could be kept in reserve to use for field trips and out-of-town athletic events and to use as backup vehicles when buses break down. Currently, the board charters buses from a private company for these purposes. The annual cost of chartering buses amounts to PHP31.000. The school district controller has estimated that this cost could be cut to PHP6,000 per year if the six buses were kept in reserve. The six full-size buses have six years of useful life remaining, either as regularly scheduled buses or as reserve buses. The useful life of a new minibus is projected to be six years also. Matalino School District uses a hurdle rate of 14 percent on all capital projects. Required: 1. Suppose the board of education chooses to buy the minibuses. Calculate the net present value of this option. 2. Compute the internal rate of return on the proposed minibus acquisition. 3. Should the full-size buses be sold now or kept in reserve? 4. Give your recommendation to the School District as regard the decision as to the minibuses and the full-size buses