A Boeing contractor responsible for producing a portion of the landing gear for huge airliners experienced a stormrelated power glitch that did considerable damage. Risk analysis indicated that a cost of approximately \($600,000/year\) might be expected if nothing is done. PolyPhaser was commissioned to do a turnkey installation, costing \($960,000\) installed, to protect the process from these yearly losses. This will be the company’s only capital expenditure during 2011. A total of \($550,000\) is borrowed at a rate of 12 percent per year for the entire 10-year planning horizon. Deductible annual operating and maintenance costs are \($Y,\) and depreciation is MACRS-GDS in the 7-year property class. The marginal tax rate is 40 percent, the after-tax MARR is 10 percent, and the expected life of the PolyPhaser equipment is 10 years. The loan is paid back using Method 1 (interest only at the end of each year of the loan, plus principal at the end of the last year). There is no salvage value. Use Goal Seek or Solver in Excel® to determine the value of Y such that the ATMARR is exactly achieved, no more and no less, if

a. the investment tax credit has been reinstated at the 10 percent level.

b. the Section 179 expense deduction is used.