Explain answer please

SECTION III: INVESTMENT DECISONS A cloth manufacturing firm is deciding whether or not to invest in new machinery. The machinery costs $45,000 and is expected to increase cash flows in the first year by $25,000 and in the second year by $30,000. The firm's current fixed costs are $9,000 and current marginal cost are $15. The firm currently charges $18 per unit. a. If the cost of capital is 5% what is the net present value (NPV) of the investment in the new machinery? b. If the interest rate (cost of capital) is 5%, should the firm undertake the investment? Why