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If a machine costs $2.5 million and is expected to last for 5 years with no salvage value. Straight line depreciation will be used. Cash

If a machine costs $2.5 million and is expected to last for 5 years with no salvage value. Straight line depreciation will be used. Cash inflows, currently at $5 million per year, are expected to increase to $5,750,000 annually if the machine is purchased. Assume that the machinery can begin to increase cash flow in 1 year, and the company expenses are consistently 60% of cash flows, what is the after tax cash flow in each year of the next 5 years? Tax rate is 34%. If the discount rate is 10%, do we accept this project based on NPV rule?

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