Assume that a company is considering purchasing a machine for $50,000 that will have a five-year useful life and a $5,000 salvage value. The machine will lower operating costs by $16,250 per year. The companys required rate of return is 16%. The net present value of this investment is closest to: Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using the tables provided.

Multiple Choice

• $3,203.

• $7,973.

• $19,033.

• $5,583.