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1. ChooChoo Inc. is a manufacturer of model trains. The company isconsidering the purchase of an industrial 3D printer, which willallow the firm to produce custom-made model trains for its high-endcustomers. The printer will cost $1,000,000, and it is expected toproduce net cash flows of $350,000 per year for the next six years.Liquidation of the equipment will net the firm $100,000 in cash atthe end of six years. The firm requires a 13% rate of return on allinvestments. Ignore the effects of taxes.a. What is the payback period for theproposed investment in the 3D printer? Provide your answer innumber of years and months. b. What is the printer’s discountedpayback period? Provide your answer in number of years and months. c. Choo Choo’s cutoff period is set atthree years. Based on the payback period investment criterion, willthe company purchase the printer? Will it purchase the printerbased on the discounted payback period investment criterion?(1 mark)d. What is the printer’s net presentvalue (NPV)? Should the company purchase the printer based on theNPV investment criterion?e. What is the printer’s profitabilityindex (PI)? Should the company purchase the printer based on the PIinvestment criterion? f. What is the printer’sinternal rate of return (IRR)? g. Check that at the internal rate ofreturn (IRR) the net present value of the printer is $0. Should thecompany purchase the printer based on the IRR investmentcriterion? h. Based on your answers in parts a-fabove, what decision do you recommend for Choo Choo?