Fastbit Corp. has an opportunity to invest in a new high-speed computer that costs $50,000. The computer will generate cash flows (due to cost savings) of $25,000 one year from now, $20,000 two years from now, and $15,000 three years from now. The computer will be worthless after three years. Fastbit financial managers have determined that the appropriate discount rate for this investment is 7% per year, compounded annually. Should Fastbit invest in this computer, and what is the net present value of the investment? (Choose the best answer.)

Information on gerken power co., is shown below. assume the company’s tax rate is 40 percent. debt: 9,400 8.4 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 100.5 percent of par; the bonds make semiannual payments. common stock: 219,000 shares outstanding, selling for $83.90 per share; beta is 1.24. preferred stock: 12,900 shares of 5.95 percent preferred stock outstanding, currently selling for $97.10 per share. market: 7.2 percent market risk premium and 5 percent risk-free rate. required: calculate the company's wacc. (do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) wacc %