The XYZ Tile Co. has decided to secure its tile clay from a property owned by John Doe, adjacent to the tile plant. The company has made a royalty contract with Mr. Doe according to which Doe's holdings will supply the company's need of 200,000 tons per year for the next 15 years before the clay is exhausted. For the first five years, the company will pay a royalty of $1 per ton of clay. For the next ten years, the royalties will double to $2 per ton of clay. The president of the XYZ Tile Co. has just learnt that Doe would consider an outright sale of his land to the company. By purchasing this land, the company would no longer have to pay royalty for the clay removed. It is believed that at the end of 15 years, when the clay is exhausted, the land can be sold for $30,000. a. Determine the maximum price at which XYZ Tile Co. can purchase the land, so that buying the land is more attractive than paying royalties. The MARR for the company is 15% per year. (10 Points) b. Mr. Doe is in relatively poor health. He feels he cannot manage and check the tonnage removed himself and that he will need to employ a part-time engineer to survey the clay removal at a cost of $2000 a year. In trying to decide how much he should ask for the land, (should he decide to sell it), he considers a MARR of 10% per year. What should his asking price be today? (10 points)