Q9

Intro Better Tires Corp. is planning to buy a new tire making machine for $90,000 that would save it $40,000 per year in production costs. The savings would be constant over the project's 3-year life. The machine is to be linearly depreciated to zero and will have no resale value after 3 years. The appropriate cost of capital for this project is 13% and the tax rate is 21%. Part 1 - - Attempt 2/10 for 10 pts. What is the cash flow from assets in each year of operation (years 1 to 3 )? Part 2 - B Attempt 1/10 for 10 pts. What is the NPV of this project