Vigor-max is considering buying a new water treatment system for its plant in Austin, Texas. The investment proposal passed the initial screening tests (payback and accounting rate of return) so the company now wants to analyze the proposal using the discounted cash flow methods. The water treatment system costs $37,800, has a seven-year life, and has no residual value. The estimated net cash inflows from environmental cleanup savings are $9,000 per year over its life. The company's required rate of return is 18%. (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements Requirement 1. Compute the water treatment system's NPV. (Enter any factor amounts to three decimal places, XXXX. Use parentheses or a minus sign for a negative NPV.) Net Cash Annuity PV Factor Years Inflow (i=18%, n=7) Present Value Years 1-7 Present value of annuity Year 0 Investment Net present value - X Requirements 1. Compute the water treatment system's NPV. 2. Find the water treatment system's IRR (exact percentage is not required). 3. Should Vigor-max buy the water treatment system? Why or why not? Present Value of $1 Periods Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 1% 2% 3% 4% 5% 0.990 0.980 0.971 0.962 0.952 0.980 0.961 0.943 0.925 0.907 0.971 0.942 0.915 0.889 0.864 0.961 0.924 0.888 0.855 0.823 0.951 0.906 0.863 0.822 0.784 6% 0.943 0.890 0.840 0.792 0.747 7% 0.935 0.873 0.816 0.763 0.713 8% 0.926 0.857 0.794 0.735 0.681 9% 10% 12% 14% 0.917 0.909 0.893 0.877 0.842 0.826 0.797 0.769 0.772 0.751 0.712 0.675 0.708 0.683 0.636 0.592 0.650 0.621 0.567 0.519 15% 16% 18% 20% 0.870 0.862 0.847 0.833 0.756 0.743 0.7180.694 0.658 0.641 | 0.609 0.579 0.572 0.552 0.516 0.482 0.497 0.476 0.437 0.402 0.942 0.888 0.837 0.790 0.746 0.933 0.871 0.813 0.760 0.711 0.923 0.853 0.789 0.731 0.677 0.914 0.837 0.766 0.703 0.645 0.905 0.820 0.744 0.676 0.614 0.705 0.665 0.627 0.592 0.558 0.666 0.623 0.582 0.544 0.508 0.630 0.583 0.540 0.500 0.463 0.596 0.564 0.507 0.547 0.513 0.452 0.502 0.467 0.404 0.460 0.424 0.361 0.422 0.386 0.322 0.456 0.400 0.351 0.308 0.270 0.432 0.410 0.370 0.335 0.376 0.354 0.314 0.279 0.327 0.305 0.266 0.233 0.284 0.263 0.225 0.194 0.247 0.227 0.191 0.162 0.475 0.444 0.415 0.388 0.362 0.429 0.397 0.368 0.340 0.315 0.388 0.350 0.287 0.237 0.215 0 195 0.162 0.135 0.356 0.319 0.257 0.208 0.1870.168 0.137 0.112 0.326 0.290 0.229 0.182 0.163 0.145 0.116 0.093 0.299 0.263 0.205 0.160 0.141 0.125 0.099 0.078 0.275 0.239 0.183 0.140 0.123 0.108 0.084 0.065 0.339 0.317 0.296 0.277 0.258 0.292 0.270 0.250 0.232 0.215 0.252 0.218 0.163 0.123 0.231 0.198 0.146 0.108 0.212 0.180 0.130 0.095 0.194 0.164 0.116 0.083 0.178 0.149 0.104 | 0.073 Period 11 0.8961 0.804 0.722 0.650 0.585 0.527 Period 12 0.887 0.788 0.701 0.625 0.557 0.497 Period 13 0.879 0.773 0.681 0.601 0.530 0.469 Period 14 0.870 0.758 0.661 0.577 0.505 0.442 Period 15 0.861 0.743 0.642 0.555 0.481 0.417 Period 16 0.853 0.7280.623 0.534 0.458 0.394 Period 17 0.844 0.714 0.605 0.513 0.436 0.371 Period 18 0.836 0.7000.587 0.494 0.416 0.350 Period 19 0.828 0.686 0.570 0.475 0.396 0.331 Period 20 0.820 0.673 0.554 0.456 0.377 0.312 Period 21 0.811 0.660 0.538 0.439 0.359 0.294 Period 22 0.803 0.647 0.522 0.422 0.342 0.278 Period 23 0.795 0.634 0.507 0.406 0.326 0.262 Period 24 0.788 0.622 0.492 0.390 0.310 0.247 Period 25 0.780 0.610 0.478 0.375 0.295 0.233 Period 26 0.772 0.598 0.464 0.361 0.281 0.220 Period 27 0.764 0.586 0.450 0.347 0.268 0.207 Period 28 0.757 0.574 0.437 0.333 0.255 0.196 Period 29 0.749 0.563 0.424 0.321 0.243 0.185 Period 30 0.742 0.552 0.412 0.308 0.231 0.174 0.107 0.093 0.071 0.054 0.093 0.080 0.060 0.045 0.081 0.069 0.051 0.038 0.070 0.060 0.043 0.031 0.061 0.051 0.037 0.026 0.053 0.044 0.031 0.022 0.046 0.038 0.026 0.018 0.040 | 0.033 0.022 0.015 0.035 0.028 0.019 0.013 0.030 0.024 0.0160.010 0.242 0.226 0.211 0.197 0.184 0.199 0.184 0.170 0.158 0.146 0.1640.135 0.093 0.150 0.123 0.083 0.138 0.112 0.074 0.126 0.102 0.066 0.116 0.092 0.059 0.064 0.056 0.049 0.043 0.038 0.172 0.161 0.150 0.141 0.131 0.135 0.125 0.116 0.107 0.099 0.106 0.084 0.053 0.033 0.098 0.076 0.047 0.029 0.090 0.069 0.042 0.026 0.082 0.063 0.037 0.022 0.075 0.057 0.033 0.020 0.026 0.023 0.020 0.017 0.015 0.021 0.014 0.009 0.018 | 0.0110.007 0.016 0.010 0.006 0.014 0.008 0.005 0.012 0.007 0.004 Period 40 0.672 0.453 0.307 0.208 0.142 0.097 0.067 0.046 0.032 0.022 0.011 0.005 0.004 0.003 0.001 0.001 Period 50 0.608 0.372 0.228 0.141 0.087 0.054 0.034 0.021 0.013 0.009 0.003 0.001 0.001 0.001 16% 0.862 1.605 2.246 2.798 3.274 18% 20% 0.847 0.833 1.566 1.528 2.174 2.106 2.690 2.589 3.127 2.991 3.685 4039 4 344 4.607 4.833 3.498 3.326 3.812 3.605 4.078 3.837 4.303 4.031 4.4944 192 Present Value of Ordinary Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 14% 15% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.893 0.877 0.870 Period 2 1.970 1.942 1.913 1.886 1.859 1.833 1.808 1.783 1.759 1.736 1.690 1.647 1.626 Period 3 2.941 2.884 2.829 2.775 2.723 2.673 2.624 2.577 2.531 2.487 2.4022322 2.283 Period 4 3.902 3.808 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.037 2.914 2.855 Period 5 4.853 4.713 4.580 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.605 3.433 3.352 Period 6 5.795 5.601 5.417 5.242 5.076 4917 4.767 4.623 4486 4 355 4 111 3.889 3.784 Period 7 6.728 6.472 6.230 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.5644 288 4.160 Period 8 7.652 7.325 7.020 6.733 6.463 6.210 5.971 5.747 5.535 5.335 4.968 4.639 4.487 Period 9 8.566 8.162 7.786 7.435 7.108 6.802 6.515 6.247 5.995 5.759 5.3284946 4.772 Period 10 9.471 8.983 8.530 8.111 7.722 7.360 7.024 6.710 6.418 6.145 5.6505.216 5.019 Period 11 10.368 9.787 9.253 8.760 8.306 7.887 7 499 7.139 6.805 6.495 5.938 5.453 5.234 Period 12 11.255 10.575 9.954 9.385 8.863 8.384 7.943 7.5367.1616.814 6.1945.660 5.421 Period 13 12.134 11.348 10.6359.986 9.394 8.853 8.358 7.904 7.487 7.103 6.424 5.8425.583 Period 14 13.004 12.106 11.296 10.563 9.899 9.295 8.745 8.2447.786 7 367 6.628 6.002 5.724 Period 15 13.865 12.849 11.938 11.118 10.380 9.712 9.108 8.559 8.061 7.606 6.811 6.142 5.847 Period 16 14.718 13.578 12.561 11.652 10.838 10.106 9.447 8.851 8.313 7.824 6.9746.265 5.954 Period 17 15.562 14.292 13.166 12.166 11.274 10.4771 9.763 9.122 8.544 8.022 7.120 6.373 6.047 Period 18 16.398 14.992 13.754 12.659 11.690 10.828 10.059 9.3728.756 8.201 7.250 6.467 6.128 Period 19 17.226 15.678 14.324 13.134 12.085 11.158 10.336 9.604 8.950 8.365 7.366 6.550 6.198 Period 20 18.046 16.351 14.877 13.590 12.462 11.470 10.594 9.818 9.129 8.514 7.469 6.623 6.259 Period 21 18.857 17.011 15.415 14.029 12.821 11.764 10.836 10.0179.292 8.649 7.562 6.687 6.312 Period 22 19.660 17.658 15.937 14.451 13.163 12.042 11.061 10.2019.442 8.772 7.645 6.743 6.359 Period 23 20.456 18.292 | 16.444 14.857 13.489 12.303 11.272 10.371 9.5808.883 7.718 6.792 6.399 Period 24 21.243 18.914 16.936 15.247 13.799 12.550 11.469 10.529 9.7078.985 7.7846.835 6.434 Period 25 22.023 19.52317.413 15.622 14.094 12.783 11.654 10.675 9.8239.077 7.8436.873 6.464 Period 26 22.795 20.121 17.877 15.983 14.375 13.003 11.826 10.8109.929 9.161 7.896 6.906 6.491 Period 27 23.560 20.707 18.327 16.330 14.643 13.211 11.987 10.935 10.027 9.237 7.943 6.935 6.514 Period 28 24.316 21.281 18.764 16.663 14.898 13.406 12.137 11.051 10.116 9.307 7.984 6.961 6.534 Period 29 25.066 21.844 19.188 16.984 15.141 13.591 12.278 11.158 10.1989.370 8.022 6.983 6.551 Period 30 25.808 22.396 19.600 17.292 15.372 13.765 12.409 11.258 10.274 9.427 8.055 7.003 6.566 Period 40 32.835 27.355 23.115 | 19.793 17.159 15.046 13.332 11.925 10.757 9.779 8.244 7.105 6.642 Period 50 39.196 31.424 25.730 21.482 18.256 15.762 13.801 12.233 10.962 9.915 8.304 7.133 6.661 5.029 4.656 4.327 5.197 4.793 4.439 5.342 4.910 4.533 5.468 5.008 4.611 5.575 5.092 4.675 5.669 5.1624.730 5.749 5.222 4.775 5.818 5.273 4.812 5.877 5.316 4.844 5.929 5.353 4.870 5.973 6.011 6.044 6.073 6.097 5.384 4 891 5.410 4.909 5.432 4.925 5.451 4.937 5.467 4.948 5.480 4956 5.492 4964 5.5024970 5.510 4.975 5.517 4.979 6.118 6.136 6 152 6.166 6.177 6.233 5.548 4.997 6.246 5.5544999