2. Probiem 12.04 (Replacement Analysis) The Ovido Company is considering the purchase of a new machine to replace an obsolete one. The machine being used for the operation has a book value and a market value of zero. However, the machine is in goed norking order and wit last at least another 10 years. The proposed reptacement machine will perform the operation so much more emcently that Ovieda's engineers estimate that it will produce after-tax cash flows (labor savings) of $7,000 per yeac The atter-tax cest of the new machine is 550,000 , and its econamic life is estimated to be 10 years. It has zero saivage value. The frm's wacc is 10%, and its marginal tax rate is 25%. Should Oviede buy the new machine? Oviedo purchase the new machine