Daily Enterprises is purchasing a $$5,000,000$ machine. The machine will be depreciated using straight$-$line depreciation over its $6$ year life and will have no salvage value. The machine will generate revenues of $$10,000,000$ per year along with costs of $$1,000,000$ per year.

If Daily's marginal tax rate is $39\%,$ what will be the cash flow in each of years $1$ to $6($the cash flow will be the same each year$)?$

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$5,815,000$

Correct response: $5,815,000+-1$

Given annual cash flows of $$5,815,000,$ if the discount rate is $14\%,$ what is the NPV of the project?

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Should Daily accept or reject the project $($choose one$)?$

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Accept

Reject