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ABC Corporation is considering the purchase of a machine that would cost $190,000 and would last for 10 years. At the end of 10 years,
ABC Corporation is considering the purchase of a machine that would cost $190,000 and would last for 10 years. At the end of 10 years, the machine would have a salvage value of $16,000. By reducing labor and other operating costs, the machine would provide annual cost savings of $32,000. The company requires a minimum pretax return of 13% on all investment projects. (Ignore income taxes.)
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