Brooklyn Corporation has a used machine with a current book value of $$1\mathrm{.}2$ million that it can sell today for $$2\mathrm{.}0$ million. It can keep the machine for eight more years, but the annual maintenance costs will be $$920,000$ next year and increase at a $3\%$ annual rate. Yearly depreciation for income tax purposes will be $$150,000($$$1\mathrm{.}2$ million $/8$ years$).$ The machine's expected selling price at the end of eight years is $$120,000.$A replacement machine is available at a cost of $$5\mathrm{.}2$ million. It will last for eight years, have annual maintenance costs of $$400,000$ next year, increasing at a $3\%$ annual rate, and an expected residual value of $$500,000.$ Brooklyn will use straight$-$line depreciation over eight years to a $$0\mathrm{.}4$ million residual value on its tax return.At the end of eight years, Brooklyn will have to replace either machine at a cost of $$8$ million.Brooklyn's averagecombined $($federal and state$)$ income tax rate is $25\%,$ its marginal combined income tax rate is $30\%$ and its required rate of return is $15\mathrm{.}36\%.$ The company has sufficient income to benefit from depreciation tax shields.