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David, Inc. is evaluating the purchase of a new machine to replace an existing machine. Existing machine is currently generating sales revenue of $100,000 per
David, Inc. is evaluating the purchase of a new machine to replace an existing machine. Existing machine is currently generating sales revenue of $100,000 per year and can easily last for another year. New Machine will generate cash inflow of $1,000,000 per year for the next 10 years. Which of the following is true?
a. Total cash inflow in year 1 will be $1,000,000
b. Total cash inflow in year 1 will be $1,100,000
c. Total cash inflow in year 1 will be $900,000
d. Total cash inflow in year 1 will be $100,000
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