The Dauten Toy Corporation currently uses an injection molding machine that was purchased $2$ years ago. This machine is being depreciated on a straight$-$line basis, and it has $6$ years of remaining life. Its current book value is $$2,100,$ and it can be sold for $$2,500$ at this time. Thus, the annual depreciation expense is $$2,\frac{100}{6}=$$$350$ per year. If the old machine is not replaced, it can be sold for $$500$ at the end of its useful life. Dauten is offered a replacement machine which has a cost of $$8,000,$ an estimated useful life of $6$ years, and an estimated salvage value of $$800.$ This machine falls into the MACRS $5-$year class so the applicable depreciation rates are $20\%,32\%,19\%,12\%,11\%,$ and $6\%.$ The replacement machine would permit an output expansion, so sales would rise by $$1,000$ per year; even so$,$ the new machine's much greater efficiency would cause operating expenses to decline by $$1,500$ per year. The new machine would require that inventories be increased by $$2,000,$ but accounts payable would simultaneously increase by $$500.$ Dauten's marginal federal$-$plus$-$state tax rate is $40\%,$ and its WACC is $11\%.$ Should it replace the old machine?