A company plans to replace the old machine

by a new one. The old machine has 2

working years remaining and the

depreciation per each year equals $1,000, and

will be sold for 5,000. The new machine will

cost $40,000 with zero installation cost. The

new machine would require an increase by

$500 in the net working capital. What would

be the initial investment required to buy the

new machine If the company is at 38% tax

bracket?

-45,000

-47,500

-43360

-45,500

or

O Zero