Problem 14-28 (Algo) Net Present Value Analysis [LO14-2] Bilboa Freightlines, 5A., of Panama, has a small truck that it uses for intracity deliveries. The truck is worn out and must be either overhauled or replaced with a new truck. The company has assembled the following information: Present Truck New Truck Purchase cost new $ 32,000 $ 40,000 Remaining book value $ 19,000 Overhaul needed now 5 18,000 Annual cash operating costs $ 16,500 $ 14,000 Salvage valuenow $ 8,000 Salvage valuefive years from now $ 7,000 $ 6,000 If the company keeps and overhauls its present delivery truck, then the truck will be usable for five more years If a new truck is purchased, it will be used for five years, after which it will be traded in on another truck. The new truck would be dieseloperated, resulting in a substantial reduction in annual operating costs, as shown above. The company computes depreciation on a straight-line basis. All investment projects are evaluated using a 11% discount rate. Click here to view Exhibit 1481 and Exhibit 14B2, to determine the appropriate discount factor(s) using tables. Required: 1. What is the net present value ofthe \"keep the old truck\" alternative? 2. What is the net present value of the \"purchase the new truck" alternative? 3. Should Bilboa Freightlines keep the old truck or purchase the new one