You are the Head of Secutity at the USNA. You are considering installing on of thos new technology facial recoginiation systems, similar to what the TSA and Delta are testing at the Atlanta Airport today, at te Rockwell Center. The system checks visitors' facial identity agains a data base of felons, those on the no-fly list Initial Cost West Point Cadets and prevents these potential mischief makers from admission to the Yard. It would Annual Savings save a considerable abount of staff resources in checking drivers' licenses, passports or other time-cor Life documents and allow you to reduce staff. You have received two competing proposals, one from Rockwell Collins, a well-known manufactuer fo quality products and another from the Palermo Corporatin, a loca Palermo small business. Details on both proposals are described below. Palermo is cheaper but likely not as Initial Cost reliable and will cost more to maintain and not provide as much in the way of labor savings as Rockwe Savings Yrs 1-5 However, you cannont just pick the best system. Your JAG Office has opined that as both systems meet Savings Yrs 6-10 specifications of the contract solicitation, you have to pick the one that provides the 'best value' to the Life Government and not exclude Palermo out-of-hand. You have the budget authority to pick only one of the two systems. Because you are a govenmental entity, you don't care about taxes and have never heard about depreciation - it's not a line item in your budget. Cash flow is all that matters to you Choose which proposal you would recommend to the Supe and in a sentence or two, describe why this is the best use of your resources. As an enlightened USNA graduate, the Supe will expect you to use the analysis techniques that are taught at the USNA. You may use multiple techniques (NPV, IRR, MIRR, payback, etc.) in your analysis. The Government's cost of capital is 4%. The Rockwell System is the more expensive machine. It costs $750,000. The annual savings compared to today's situation are $150,000 per year for all ten years of the system's operations. Palermo's System is initially less costly. It costs $400,000. Due to its higher operating costs and lower reliability, its annual savings fo for the first five years of operations are $100,000 per year. As the system ages, maintenance costs and false positives (identifying normal tourists as West Point Cadets) will increase, causing savings to decrease to $75,000 per year for years 6-10. Both systems will operate for ten years and then be scrapped with no residual value Which of the two systems should you recommend? In a few sentences state your choice and rationale to the Supe. Use the temolate to the right of this description in developing vour analvsis.. Rockwell Palermo Total Total Cost of Machine Savings Cost of Cashflow 0750000 150000 Machine Savings Cashflow 0-400000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 75000 75000 75000 75000 75000 75000 75000 75000 75000 75000 year 750000 g 150000 10 0750000 150000 5 100000 10 75000 10 Cost of Capital 4% 10 Total 475000