Problem 1 A semi-conductor company in California will significantly expand her chemical vapor deposition units in their various production sites in south-west of the United States. The cash flow for one phase of the project is shown below. Given reinvestment rate of 15% per year for excess funds and 11% per year for borrowing rate for extra funds, with 13% MARR, determine: Year Net cash flow 0 -48000 1 +20000 2 -90.000 3 +64000 4 -10,000 3 -33,000 a) Determine the number of possible ROR values and why? b) Calculate the external rate of return (MIRR). c) Is the project economically viable? Problem 2 The TT Racing and Performance Motor Corporation wishes to evaluate two alternative machines for NASCAR motor tune-ups. The MARR adopted by TT Racing is 14.3 %. The two guesses for the RORs are: 14% and 15% Initial cost, S Machine R Machines -145000 -80,000 - 16000 -28000 Annual operating and maintenance cost, S per year 51000 61,000 Annual revenues per year Salvage value, $ Life. years 35,000 20,000 10 a) Construct the Incremental Cash Flow Diagram b) Determine the Incremental Annual Worth cash flow equation. c) Using incremental annual worth cash flow equation for the incremental rate of return analysis, select which machine (R or S) will be the best option