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Problem 2: Miami Roadbuilding Company {MRC} is considering the purchase of a new Steamroller. The steamroller costs $95,000, and an additional 55,060 is needed to

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Problem 2: Miami Roadbuilding Company {MRC} is considering the purchase of a new Steamroller. The steamroller costs $95,000, and an additional 55,060 is needed to paint it with the firm logo and install radio equipment (i.e., to get it ready for productive use). The equipment falls into the MACRS 3year class, and is not expected to generate any additional revenue. However, it is expected to reduce cash operating costs by $35,000 per year. After its five year useful life, MRC expects to sell the Steamroller for 540,000. An inventory investment of 54,000 is required during the useful life of the equipment. If MRC's cost of capital for the project is 10% and its marginal tax rate is 45%, what is the project's NPV

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