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A new, more efficient machine will last four years and allow inventory levels to decrease by $100,000 during its life. At a cost of capital

A new, more efficient machine will last four years and allow inventory levels to decrease by $100,000 during its life. At a cost of capital of 13 percent, how does the net working capital change affect the project's NPV?

1)NPV increases by $38,668

2)NPV increases by $138,668

3)NPV increases by $100,000

4)NPV increases by $61,330

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