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Kinston industries is considering investing in a machine that will cost $125000 and will last for three years. The machine will generate revenues of $12000

Kinston industries is considering investing in a machine that will cost $125000 and will last for three years. The machine will generate revenues of $12000 each year and the cost of good sold will be 50% of sales. At the end of year three the machine will be sold for $15000. The appropriate cost of capital is 10% and Kinston is in the 35% tax bracket. Assume that Kinston's new machine will be depreciated straight line to a salvage value of $5000 at the end of year three. What is the NPV for this project?

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