Question

3.1 Hare-Hare, a music studio located in Garfield, wants to replace all its audio recording equipaments. The investment will cost $95,000 and will generate $23,000 revenue per year for 5 years. The salvage value will be $28,000 after the 5 years. Assume the equipment has a 18% MARR. a) Determine IRR for the machine using interpolation. [4 points] b) Since the operator requires at least a 18% retum on thier investments, should the machine be purchased? Why? [0.5 point 0.5 point]