A large automobile manufacturing company is considering the installation of a high-tech handling system. The initial cost of the system is $3,000,000 and it is estimated it will save $750,000 per year in manual labor, and will incur $27,500 in operating expense the first year increasing by $100 per year for every year thereafter. The salvage value at the end of the system’s 10 year life will equal the cost of removal. The company’s MARR is 12%. a. Show your cash flow diagram from the company’s perspective. b. Calculate either the PW, AW, or FW for this project. Based on your calculation, should this project be recommended for investment? State your reason for either accepting or rejecting this project. c. Use Excel to determine this project’s IRR. Based on your value for IRR, should the project be accepted or rejected? Why or why not. d. If this project was externally funded and the external financing rate, ?, was 15%, use the external rate of return methodology to solve for ERR. Based on your findings, would you still recommend this project for funding? Provide detail that supports your recommendation. e. To help finance this project, the company marketed a $3,000,000 ten-year bond paying 10% APR paid semi-annually. You have personally researched this company and feel confident this company will have the cash available to pay its debt of $3,000,000 when the bond becomes due and you also feel confident that the company has the liquidity (available cash) to pay its semi-annual interest payments to its bond holder as they become due over the life of the bond. Five years has passed and you notice this bond is available for sale. You plan to purchase this bond and hold it until it matures in 5 years. How much should you pay for this bond if you require an 8% return?