Cameron Industries is purchasing a new chemical vapor depositor in order to make silicon chips. It will cost $5,000,000 to buy the machine and $10,000 to have it delivered and installed. Building a clean room in the plant for the machine will cost an additional$3 million. The machine is expected to raise gross profits by $3,500,000 peryear, starting at the end of the firstyear, with associated costs of$1 million for each of those years. The machine is expected to have a working life of seven years and will be depreciated over those seven years. The marginal tax rate is40%. What are the incremental free cash flows associated with the new machine in year1?

A.

$5,000,000

B.

$5,010,000

C.

$715,714

D.