Net Present Value Method Master Delivery Inc. is considering the purchase of an additional delivery truck for $90,000 on January 1, 20Y4. The truck is expected to have a five-year life with an expected residual value of $10,000 at the end of five years. The expected additional revenues from the added delivery capacity are anticipated to be $60,000 per year for each of the next five years. A driver will cost $30,000 in 20Y4, with an expected annual salary increase of $2,000 for each year thereafter. The insurance for the truck is estimated to cost $1,000 per year Present Value of $1 at Compound Interest 10% 20% 0.833 0.694 0.579 0.482 0.402 0.335 0.279 0.327 0.233 0.194 0.162 Year 696 12% 15% 0.943 0.909 0.893 0.870 0.890 0.826 0.797 0.756 0.840 0.751 0.712 0.658 0.792 0.683 0.636 0.572 0.747 0.621 0.5670.497 0.705 0.564 0.507 0.432 0.665 0.513 0.452 0.376 0.627 0.4670.404 0.592 0.424 0.361 0.284 10 0.558 0.386 0.322 0.247 a. Determine the expected annual net cash flows from the delivery truck investment for 20Y4-20Y8. If required, use the minus sign to indicate an overall negative annual net cash outfloW Annual Net Cash Flow 20Y4 20Y5 20Y6 20Y7 20Y8 b. Calculate the net present value of the investment, assuming that the minimum desired rate of return is 12%. Use the table of present value of $1 provided above. Present value of annual net cash flow Investment Net present value $ 29000 27000 $ 25000 23000 $21000