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The MIT Whitehead Institute must choose between two cDNAmicroarray machines to expand thei

The MIT Whitehead Institute must choose between two cDNAmicroarray machines to expand thei

The MIT Whitehead Institute must choose between two cDNAmicroarray machines to expand their high-throughput genomiclaboratory. Both of these machines have the same function, and thefirm will only choose on vendor from which to purchase theirmachines. The first machine, manufactured by Amersham Pharmacia(machine 1), will cost $250,000. The second machine, manufacturedby PE Applied Biosystems (machine 2), will cost $200,000. The costof capital for both of these investments is 10%. The life for bothmachines is estimated to be 5 years. During this period, cash flowsfor machine 1 will be $80,000 per year and cash flows for machine 2will be $65,000 per year. These cash flows include depreciationexpenses. Calculate NPV and IRR for each machine and select thebest choice for the MIT Whitehead Institute.

Please show work. Other answers just procide the answer, thisdoesnt help me understand how the material.

Abhinav 01-Dec-2019

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