Net Present Value Method and Present Value Index Diamond & Turf Inc. is considering an investment in one of two machines. The sewing machine will increase productivity from sewing 150 baseballs per hour to sewing 290 per hour. The contribution margin per unit is so.32 per baseball. Assume that any increased production of baseballs can be sold. The second machine is an automatic packing machine for the golf ball line. The packing machine will reduce packing labor cost. The labor cost saved is equivalent to s21 per hour. The sewing machine will cost $260 000 have an eight-year life, and will operate for 1,800 hours per year. The packing machine will cost $85,000 have an eight-year life, and will operate for 1,400 hours per year Diamond & Turf seeks a minimum rate of return of 15% on its Present Value of an Annuity of $1 at Compound Interest Year 10%% 1290 20% 0.833 1.833 .736 1.690 1.6261.528 2.673 2.487 2.402 2.283 2.106 .465 3.170 3.037 2.855 2.589 4.212 3.791 3.605 .353 2.991 3.326 5.582 4.668 4.564 4.160 3.605 6.210 5.335 4.968 4.4873.837 6.802 5.759 5.328 4.772 4.031 7.360 6.15 5.650 5.019 .192 69b 15% 0.943 0.909 0.893 0.870 4.9174.355 4.111 3.785 10 . Determine the net present value for the two machines. Use, the table of present values of an annuity of 1 above-Round to the nearest dollar. Sewing Machine Packing Machine Present value of annual net cash flows Amount to be Invested Net present value b. Determine the present value index for the two machines. Round to two decimal places. Sewing Machine Packing Machine Present value index c If Diamond & Turf has sufficient funds for only one of the machines and qualitative factors are equal between the two machines in which machine should it invest