A firm is considering two types of machines to produce its output. Machine X is more expensive and lasts longer than Machine Y. The after-tax net cash flows generated by each of the two machines are tabulated below.

\begin{tabular}{|l|l|l|l|l|l|l|} \hline \multicolumn{6}{|l|}{ Machine X} \\ \hline Year & 0 & 1 & 2 & 3 & 4 & 5 \\ \hline Net cash flow & 2,000 & 700 & 700 & 700 & 700 & 700 \\ \hline \end{tabular} \begin{tabular}{|l|l|l|l|l|} \hline \multicolumn{4}{|l|}{ Machine Y} \\ \hline Year & 0 & 1 & 2 & 3 \\ \hline Net cash & 1,500 & 650 & 650 & 650 \\ \hline \end{tabular}