A Company bought Machine M on March 5, 20X4 for \(\$ 5,000\) cash. The estimated salvage was \(\$ 200\) and the estimated life was eleven years. On March 5, 20X5, the company learned that it could purchase a different machine for \(\$ 8,000\) cash. The new machine would save the company an estimated \(\$ 250\) per year compared to Machine A. The new machine would have no estimated salvage and an estimated life of ten years. The company could get \(\$ 3,000\) for Machine A on March 5, 20 X5.

{Required:}

Ignore income taxes: should the company purchase the new machine if the cost of capital is 16 percent?