For major capital investments, managers usually prepare a detailed NPV analysis. For smaller items, sometimes they make a quick calculation or use intuition. Suppose you are in charge of a company’s mail room. An employee has suggested the purchase of a €12,000 letter sorting machine. She says that it will save 1 hour per day for 250 working days a year for an employee making a total of €12 per hour. She indicates that the €12,000 expenditure will save €15,000 over the machine’s 5-year life. Should you approve the purchase?