The Pan American Bottling Co. is considering the purchase of a new machine that would increase the speed of bottling and save money. The net cost of this machine is $55,000. The annual cash flows have the following projections. Year Cash Flow 1 $15,000 2 20,000 3 25,000 4 10,000 5 5,000 a. If the cost of capital is 9%, what is the Net Present Value of selecting a new machine? (4 points)

b. What is the Internal Rate of Return (4 points)

c. The project should be (accepted) (not accepted) because: