Please refer to the image to answer all parts of the problem as it contains the information necessary to calculate the answers. A manufacturing company is considering purchasing a new piece of equipment with an upfront cost of $$500,000$ and no salvage value. The machine is expected to increase both revenues and operating expenses by $$200,000$ and $$60,000$ per year, respectively. Assume the equipment has a useful life of $5$ years; the firm uses straight$-$line depreciation and has a required rate of return of $10\%.$

QUESTIONS:

Pt $1)$ what is the equipments net present value $?$

pt $2)$ what is the equipments internal, or true, rate of return?

A$)$ less than $10\%$

B$)$ between $10$ and $12$ percent

C$)$ exactly $12\%$

D$)$ between $12\%$ and $14\%$

E$)$ greater than $14\%$

Pt $3)$ What is the equipments payback period?

Pt $4)$ what is the equipments simple rate of return?

Pt $5)$ assume that the firm sets a payback period rule of two years. Given this information, do any of the answers to the previous questions suggest that the firm should reject the proposed purchase of the equipment? Yes or no$?$

WILL GIVE A THUMBS UP FOR ANSWERS TO ALL PARTS AND WORK, THANK YOU :)