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Use Fxhitit 120.1 and Exhibit 128,2 to locate the present value of an annuzy of $1, which is the amount to be multiglied times the

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Use Fxhitit 120.1 and Exhibit 128,2 to locate the present value of an annuzy of $1, which is the amount to be multiglied times the future annual cosh fitiw amount- Each of the following scenatios is independent. Assume that all cash flows are after-tax cash flows. a. Campbell Manufacturing is considering the purchase of a new welding system. The cash benefits will be $480,000 per year, The $y stem cosis $2,450,000 and will last 10 years. b. Evee Cardenas is interested in itwerting in a women's specialty shop, The cost of the investment is $330,000, She pstimates that the return fram owning her cwin shop wit be $40,000 per year, She estimates that the shop will have a useful life of 6 years. c. Barker Company calculated the NPV of a project and found it to be $63,900. The project's life was estimated to be B years. The required rate of retum used for the NPV calculation was 10%, The project was expected to produce annual after-tax cash flows of $135,000. Required: 1. Compute the NPV for Campbell Manufacturing, assuming a discount rate of 12%, If required, reund all present value calculations to the nearest dollar. Use the minus sign to indicate a negotive NPV. x Should the company buy the new welding system? 2. Conceptual Connections Assuming a required rate of return of B\%, calculate the NPV for Evee Cardenas' investment. Rounid to the nearest doilar. If required, ratand. afl present value calculations to the nearest dofar. Use the minus sign to indicate a negative NPV. Snould she invest? What it the estimated retum was $135,000 per year? Calculate the new NPV for Evee Cardenas' investment. Would this affect the decision? What does this tell you about your analysis? Round to the nearnst dollar. x The shop be purchased. This reveais that the decision to accept or reject in this case is affected by differences in estimated

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