Regina’s teacher recently gave her a homework assignment on solving equations. Since she has been thinking about saving for a new cell phone, she decided to use the assignment as an opportunity to model a savings plan. She created this equation to model the situation. In it, y represents the total amount saved for the new cell phone, 74 is the amount of money she has now, 40 is the amount of money she saves each month for the phone, and x represents the number of months since she started saving a regular amount: 74 + 40x = y. She then solved the equation to determine how many months she’d need to save to have enough to purchase the new cell phone. Review her work, and select the error.

The gilbert instrument corporation is considering replacing the wood steamer it currently uses to shape guitar sides. the steamer has 6 years of remaining life. if kept,the steamer will have depreciaiton expenses of $650 for five years and $325 for the sixthyear. its current book value is $3,575, and it can be sold on an internet auction site for$4,150 at this time. if the old steamer is not replaced, it can be sold for $800 at the endof its useful life. gilbert is considering purchasing the side steamer 3000, a higher-end steamer, whichcosts $12,000 and has an estimated useful life of 6 years with an estimated salvage value of$1,500. this steamer falls into the macrs 5-year class, so the applicable depreciationrates are 20.00%, 32.00%, 19.20%, 11.52%, 11.52%, and 5.76%. the new steamer is fasterand allows for an output expansion, so sales would rise by $2,000 per year; the newmachine's much greater efficiency would reduce operating expenses by $1,900 per year.to support the greater sales, the new machine would require that inventories increase by$2,900, but accounts payable would simultaneously increase by $700. gilbert's marginalfederal-plus-state tax rate is 40%, and its wacc is 15%.a. should it replace the old steamer? b. npv of replace = $2,083.51