When the Fed purchases a bond from I. a commercial bank, the excess reserves increase by the full amount of the bond purchase II. a commercial bank, the money supply increases III. the public, the excess reserves increase by the amount of the bond purchase minus the reserve requirement IV. the public, the money supply decreases

You are the manager of a large crude-oil refinery. as part of the refining process, a certain heat exchanger (operated at high temperatures and with abrasive material flowing through it) must be replaced every year. the replacement and downtime cost in the first year is $165 comma 000. this cost is expected to increase due to inflation at a rate of 7% per year for six years (i. e. until the eoy 7), at which time this particular heat exchanger will no longer be needed. if the company's cost of capital is 15% per year, how much could you afford to spend for a higher quality heat exchanger so that these annual replacement and downtime costs could be eliminated?