Rogers Company, Inc., is considering purchasing a new grinding machine with a useful life of 5 years. The initial outlay for the machine is $175,000, with an additional $25,000 in essential customization. The required rate of return for Dave Company, Inc., is 12.5%. The expected cash flows are as follows: Year After-tax Expected Cash Flow

$20,000

$40,000

$70,000

$70,000

$60,000

$60,000

Calculate the simple payback period

		3.64 years
		4.00 years
		4.36 years
		4.99 years

Calculate the Net Present Value of the investment

		+$5,139
		-$6,333
		+$6,333
		+$15,139

Calculate the Internal Rate of Return for the investment

		11.74%
		12.53%
		13.29%
		15.06%