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A manufacturer is considering a purchase of a new manufacturing machine. The machine is expected to save $2,500 per year and it costs $9,000 to

A manufacturer is considering a purchase of a new manufacturing machine. The machine is expected to save $2,500 per year and it costs $9,000 to purchase. The expected useful life of the machine is 3 years and there is no expected residual value at the end of the 3 years. The minimum acceptable rate of return is 12%. Calculate the Net present value of the following investment.

What is the NPV of year one?

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