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A new machine costs $30,000 and is expected to have a 10 year life. The new machine will be depreciated on a straight-line basis over
A new machine costs $30,000 and is expected to have a 10 year life. The new machine will be depreciated on a straight-line basis over 10 years to a zero estimated salvage value. This new machine is expected to reduce the firm's cash operating costs by $4,500 per year. If the firm is in the 40 percent marginal tax bracket, determine the annual net cash flows generated by the new machine.
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