Suppose a new machine costs $100,000 and will provide nominal operating income of $50,000 in each of the next four years. The machine belongs to asset class 9, which has a CCA rate of 30%. The machine is expected to be sold for $25,000 at the end of four years. The real discount rate has been estimated to be 8% per year.

Expected inflation is 2.5% over the next four years. The firm's marginal tax rate is 38%. Assume there are other assets in the asset class when the machine is sold and

that the half-year rule applies in year one. What is the NPV of the project?

A $44,427.84

B $107,358.25

$35,435.82

(D) $94,761.86