Penguin Inc. is a company that provides refrigerated transportation for perishable products. The firm is concerned about the high costs it faces due to the amount of produce it loses during transportation as well as the fuel costs. Therefore, it is currently considering the purchase of a high-tech refrigeration vehicle which is energy efficient, environmentally friendly and will also reduce the loss of produce significantly. The vehicle (a truck) has a useful life of 8 years. If purchased, this truck will reduce total costs by 3% per year for the next three years. Thereafter, it will lose efficiency due to wear-and-tear. The truck will still help reduce total costs, but by only 1% for the remaining 5 years. The machine will be scrapped at the end of the 8th year. (Assume that the scrap value of the truck is zero.) The current transportation costs of the company are $10 million per year and the annual interest rate is 6%. (5pts) (a) What is the present value of the transportation costs the firm faces for the next 8 years if the firm does not purchase the truck? (10pts) (b)What is the present value of the transportation costs if this truck is purchased? Draw a timeline. (5pts) (c) How much will the firm save in terms of transportation costs if it purchases the truck? Should the company purchase this truck if it will cost $ 4 million today? Explain why or why not.