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A company can buy a machine that is expected to have a three-year life and a $3,290 salvage value. The machine will cost $179,362 and
A company can buy a machine that is expected to have a three-year life and a $3,290 salvage value. The machine will cost $179,362 and is expected to produce a $20,370 before-tax net income to be received at the end of each year. If a table of present values of $1 at 12% shows values of 0.8929 for one year, 0.7972 for two years, and 0.7118 for three years, what is the net present value of this investment, discounted at 12%?
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