Q3. Luffytaro owns a maritime shipping company called GomuGomu Maritime Shipping Company and is considering replacing one of its ships. His MARR is 12%. The details of the two vessels are below: Old/Current Ship: They purchased it 20 years ago at a cost of $15,555,000. It had an expected economic life of 22 years at the time of purchase and an expected salvage value of $900,000 at the end of 12 years. It now has a remaining useful life of two years, and it currently costs them $1,000,000 in annual operating costs. If they choose to sell this ship now, they can get $8,000,000 for it. New Ship: It can be purchased for $17.500,000, including installation costs, and has an estimated useful (economic) life of eight years. The new ship is expected to have an operating cost of $400,000 per year over its eight-year life. At the end of its useful life, it is estimated that it can be sold for $12,000,000 (a) What is the cash flow associated with keeping the old ship for the next two years? Also, find AECp(MARR). (b) What is the cash flow associated with purchasing the new ship for use over the next eight years? Also find AECC(MARR). (e) If they need the ship for an indefinite period, what should Luffytaro do now? Q3. Luffytaro owns a maritime shipping company called GomuGomu Maritime Shipping Company and is considering replacing one of its ships. His MARR is 12%. The details of the two vessels are below: Old/Current Ship: They purchased it 20 years ago at a cost of $15,555,000. It had an expected economic life of 22 years at the time of purchase and an expected salvage value of $900,000 at the end of 12 years. It now has a remaining useful life of two years, and it currently costs them $1,000,000 in annual operating costs. If they choose to sell this ship now, they can get $8,000,000 for it. New Ship: It can be purchased for $17.500,000, including installation costs, and has an estimated useful (economic) life of eight years. The new ship is expected to have an operating cost of $400,000 per year over its eight-year life. At the end of its useful life, it is estimated that it can be sold for $12,000,000 (a) What is the cash flow associated with keeping the old ship for the next two years? Also, find AECp(MARR). (b) What is the cash flow associated with purchasing the new ship for use over the next eight years? Also find AECC(MARR). (e) If they need the ship for an indefinite period, what should Luffytaro do now