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An engineer at the XYZ Company has identified a piece of equipment that can be purchased for $1,250,500. The machine has an estimated useful life

An engineer at the XYZ Company has identified a piece of equipment that can be purchased for $1,250,500. The machine has an estimated useful life of four years. The cost of capital (discount rate) for a project with this risk profile if 11.5%. What annual labor savings must this machine generate in order to justify the purchase price?

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