Work all problems. There are a total of 100 points. 1. (30 pts) A new milling machine costs $350,000. It is expected to generate $100,000 in revenues each year, The machine costs $20,000 per year to run. Every three years it requires maintenance costing un addi $30,000. The machine has per year to run. Every three years it rey for salvage after 8 years for $30.000 a. (20) If the MARR for the cto should buy the machine. b. ( 10 pts) Find the payback period for the machine. Ignore maintenance costs. 4. (40) A company is considering either making modifications to its current muchinery, or replacinge if. The costs and benefits are deseribed in the table below. The MARR for the company is 15%. a. (20 pts) Compare the two options assuming repeatability and select the best one. b. (20pts) Compare the two options using a coterminated approach and a study period of 5 years, You may assume that the salvage value of any machinery decreases linearly. 3. (10 pts) Steve starts a small computer company in his garage. For an initial investment of $30,000 he expects to bring in profits of $6,000 per year for 10 years. Set up, but do not solve, the equation for the IRR for this investment. b. (15 pts) You consider four possible projects, A, B, C, D, shown below. Your MARR is 20\%. Choose ine mbicmemat ins sato IRRRBA=15%IRRC-B=27%IRDC=18% Explain the reasoning behind your choice. No credit will be given without an explanation. c. ( 5pts) Find how much you would have to decrease the MARR in part (b) before a different choice would be preferred, and indicate which option you would choose