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The president of your company, MorChuck Enterprises, has asked you to evaluate the proposed acquisibion of a new chromatograph for the firm's RBD department. The

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The president of your company, MorChuck Enterprises, has asked you to evaluate the proposed acquisibion of a new chromatograph for the firm's RBD department. The equipment's basic price in $77,000, and it would cost another $16,500 to modifyit for special use by your firm. The chromatograph, which falls into the MAcRs 3 -year dass, would be sold after 3 years for $35,900. The MACRS rates for the first three years are 0.3333,0.4445 and 0.1481 . Use of the equipment would require an increase in net working capital (spare parts inventory) of $3,650. The machine would have no effect on revenues, but it is expected to save the firm $28,290 per year in before-tax operating costs, mainly labor. The firmis marginal federal-plus-state tax rate is 25%. Cash outfows and negabve NPy value, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest dollar: a. What is the Year-0 net cash flow? b. What are the project recurring cash flows in Years 1,2 , and 37 c. What is the additional (nonoperating) cash flow in Year 3 ? o. If the project's cest of capital is 11%, what is the nov of the project? shauld the chroctatograph be purchased

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