A company is evaluating the replacement of an old machine with a new one. Last year, the company hired a consultant to conduct a feasibility study about this replacement project which cost them $1000,000 at that time The consulting foes were expensed last year The old machine was purchased 3 years ago for $4 million and was being deprecated using MACRS 5-year class 20% 32% 1925 11 52% 1152 and 5.76%) The old machine can be sold for $1 million at this time if the old machine is not replaced, it can be sold for $500 000 four years from now The replacement machine has a cost of $3 million an estimated useful to of yoars. This machine will be depreciated using stronght line method to selvage Value The replacement machine would permitan output expansion, so Sales would rise by $15 million per year even so, the new machine's much greater officiency would cause operating expenses to decline by $350 000 per year. The new machine would require that inventones to increase by $1 million accounts receivables to increase by $750,000 accounts payable increase by S400.000 and accrued expenses increase by $300.000 The interest expense on the debt component of the capital required for this project will be $350,000 annually the new machine can be sold for $125,000 at the end of 4 years to another company. The company's marginal federal plus-state tax rates 30% and its WACC is 12 What is the initial investment CFO? -3,614,500 2504300 3,004,400 4108.200 2.864.000