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You must evaluate the purchase of a proposed spectrometer for the RsD department. The purchase price of the spectrometer including modifications is $290,000, and the

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You must evaluate the purchase of a proposed spectrometer for the RsD department. The purchase price of the spectrometer including modifications is $290,000, and the equipment will be fully depreciated at the time of purchase. The equipment would be sold after 3 years for 573,000 . The equipment would require an $11,000 increase in net operating working capital (spare parts inventory). The project would have no effect on revenues, but it should save the firm 567,000 per year in before-tax labor costs. The firm's marginal federal-plus-state tox rate is 2546. a. What is the initial investment outlay for the spectrometer after bonus depreciation is considered, that is, what is the Year 0 project cash fiow? Enter your answer as a positive value. Round your answer to the nearest doliar. 5 b. What are the project's annual cash flows in Years 1, 2, and 3 ? Do not round intermediate calculations. Round your answers to the nearest doliar. Year 1 is 5 Year 2:5 Year 3: 5 c. If, the.WACC is 1156 , should the spectrometer be purchased

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