You must evaluate the purchase of a proposed spectrometer for the R&D department. The purchase price of the spectrometer including modifications is $130,000, and the equipment will be fully depreciated at the time of purchase. The equipment would be sold after 3 years for $40,000, The equipment would require a 14,000 increase working capital (spare parts inventory. The profect would have no effect on revenues. but it should save the firm $52.000

year in before-tax labor costs. The firm's marginal federal-plus-state tax rate is 25%

a. What is then initial out lay for then spectrometer, this is, what is the Year 0 project cash flow. Enter your answer as a positive value. Round your answer to the nearest dollar.

b. what are the projects annual cash flows in Years 1, 2, and 3? Do not round intermediare calculations. Round your answers to the nearest dollar.

c. If the WACC is 10%, should the spectrometer be purchased?

52,000 per vear in beferesex iabar eate. The termis marpinal fedoral-plut-state tas rate is 25 \%. Fear : 4 Ther 1 is