Answer and Explanation:
According to the scenario, computation of the given data are as follow:-
a) Net Present Value of Alternative 1
Given that
Net Initial cash investment = $150,000
Rate of return on investment = 10%
Salvage value of old machine = $15,000  
Subsequent Cash Inflow is 
= Expected Revenue Generated - Operating Cost After Overhaul
= $95,000 - $42,000
= $53,000
Year  Subsequent Cash Inflow($)	Present Value Table  (10%)	Present Value Of Cash Inflow($)
1	$53,000         0.909    $48,177
2	$53,000         0.826    $43,778
3	$53,000         0.751   $39,803
4	$53,000         0.683   $36,199
5	$68,000
(53,000+15,000)	0.621   $42,228
 Total                      $210,185
    
Now
Net Present Value is 
= Present Value of Cash Inflow - Present Value of Cash Outflow
= $210,185 - $150,000
= $60,185
b).Net Present Value of Alternative 2
Net initial cash investment = 300,000
Rate of return on investment = 10%
Cash Outflow is 
= Expected Revenue Generated - Operating Cost
= $100,000 - $32,000
= $68,000
Year  Cash Outflow($)	Present Value Table (10%)	Present Value ($)
1         $68,000                   0.909                                $61,812
2         $68,000                  0.826                                $56,168
3         $68,000                  0.751                                $51,068
4          $68,000          0.683                                $46,444
5          $88,000          0.621                                $54,648
       ($68,000 + $20,000)
Add:	Salvage value of old machine now        $29,000
 Total value                                                         $299,140
Now 
Net Present Value is 
= Present Value of Cash Inflow - Present Value of Cash Outflow
= $299,140 - $300,000
= -$860
c).According to the analysis, we recommended alternative 1 for selecting by management as it contains positive net present value