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10-15 Artistic Adobes is considering growing its business by adding a paint machine that costs $90,000. The machine will generate an additional $29,800 in before-tax

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10-15 Artistic Adobes is considering growing its business by adding a paint machine that costs $90,000. The machine will generate an additional $29,800 in before-tax operating income (excluding depreciation) for the next five years. At the end of five years, the machine can be sold for $8,000. The machine will be depreciated according to the MACRS 3-year class of assets. Artistic's marginal tax rate is 34 percent, and its required rate of return is 15 percent. Should Artistic purchase the machine? (LO 10-2)

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