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Samson Inc. is contemplating the purchase of a machine that will provide it with the net after-tax cash savings of $100,000 per year for eight

Samson Inc. is contemplating the purchase of a machine that will provide it with the net after-tax cash savings of $100,000 per year for eight years. Interest is 10%. Assume the cash savings occur at the end of each year.

Calculate the present value of the cash savings:

Prepare a calculation to prove that answer is correct:

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