The Apple company is considering a machine to reduce operation costs. The machine costs $2B.

If bought, the machine will reduce cost of good sold by $1B a year for the next three years.

The machine will also reduce the firm's required working capital by $275M immediately.

At the end of the life of the machine, this amount of net working capital will be required again. Apple is expected to use the machine for only 3 years.

Then it intends to sell it for $500M. The machine, however, can be fully depreciated for tax purposes over one year.

Apple's tax rate is 30%, and its opportunity cost of capital is 9.5%. For a fee of $15M (a taxable expense for Apple), you were hired to evaluate the viability of the purchase.

While the work is being done now, your consulting fee will be paid in two years. What should be your recommendation - should Apple buy the machine?