tions Problem 12.08 12 Chedsty Works remaining Click here to read the eBook: Analysis of an Expansion Project NEW PROJECT ANALYSIS You must evaluate the purchase of a proposed spectrometer for the R&D department. The base price is $60,000, and it would cost another $15.000 to modify the equipment for special use by the firm. The equipment falls into the MACRS 3-year class and would be sold after years for $27,000. The applicatie depreciation rates are 33%, 45%, 15%, and 7%. The equipment would require a $15,000 increase in net operating working capital tre parts near The project would have no effect on revenues, but it should save the firm $27,000 per year in before tax labor costs. The firm's marginal federal-plus-state taxe is 40%. a. What is the initial investment outlay for the spectrometer, that is, what is the Year O project cash flow? Round your answer to the nearest cent. Negative amount should be indicated by a minus sign b. What are the project's annual cash flows in Years 1, 2 and 37 Round your answers to the nearest cent. In Year 15 In Year 25 In Year 3 5 c. If the WACC is 10%, should the spectrometer be purchased? -Select