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Rudy Flyer is considering whether to invest in a computer game machine that he would place in a hotel his brother owns. The machine would
Rudy Flyer is considering whether to invest in a computer game machine that he would place in a hotel his brother owns. The machine would cost $34,000 and has an expected useful life of 3 years and a salvage value of $4,000. Mr. Flyer estimates that the machine would generate revenue of $16,000 per year and have $3,000 of cash operating expenses per year. He uses the straight-line method for depreciation. His income tax rate is 30% What is Mr. Flyer's after-tax cash flow if he invests in the machine
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