Question: Question 3 [20 Marks] A company purchases a new automatic machine to boost their production capability. The machine costs $30,000 with a $15,000 operating costs

Question 3 [20 Marks] A company purchases a new automatic machine to boost their production capability. The machine costs $30,000 with a $15,000 operating costs per annum. It is expected that this new system will save $40,000 pa in labour. The machine will operate for 5 years with a salvage value of $3,000 . (a) Determine the net cash flow diagram. [10 Marks] (b) If the firm's interest rate is 15% , what is the discounted-payback period for this machine?

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