Problem $2$

A company is considering an investment proposal to install new milling controls at cost of $50,000.$ The facility has a life expectancy of $5$ years and no salvage value. The tax rate is $35\%.$ Assume the firm uses straight line depreciation and the same is allowed for tax purposes. The estimated cash flow before depreciation in tax $($CFBT$)$ from the investment proposal are as follows:

compute the following number

Payback.

Average rate of return

Internal rate of return

NPV @ $10\%$ discount rate and

Profitability index @ $10\%$ discount rate

Year CFBT

$\backslash$table$[[1,100002,106923,127694,134625,20385$