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We are considering the purchase of a machine that will cost $ 1 0 , 0 0 0 and increase profits by 5 4 ,

We are considering the purchase of a machine that will cost $10,000 and increase profits by 54,000 each year over its 5 year useful life. There is no salvage value on the machine at the end of five years.Depreciation will be $1,000 per year and is not included in the profit listed above.The company's cost of capital is 8%. Calculate AAR

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