Question 1 H Co. is considering purchasing a new machine. At present, it uses an old machine which can process 8,000 units of product P. This machine could be replaced with a new machine AB, which can produce 20,000 units per week. Machine AB costs 400,000. Removing the old machine and preparing the area for the new machine will cost 20,000. The company expects demand for P to be 12,000 units per week for another three years. After this, in the fourth year, the new machine would be sold for 50,000. This sale is not expected to take place until later in the fourth year. Each P sells for 7.00 and has a contribution to sales ratio of 0.2 per unit. The company works for 48 weeks in the year. H Co normally expects a payback within two years and its cost of capital is 10% per annum. Required: (a) Calculate the payback and the net present value for the machine. (b) Recommend, with reasons, whether the machine should be purchased. Include any reservations you may have about your decision. (c) Critically comment on how an IT or marketing investment decision might differ in terms of approach and assessment