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We are replacing a fully depreciated old food processing machine with a new, more efficient model which costs $9000. The machine would be depreciated on

We are replacing a fully depreciated old food processing machine with a new, more efficient model which costs $9000. The machine would be depreciated on a straight-line basis over its 3-year useful life to a book value of $300. At the end of the life of the project (at the year 3 point), the machine will be sold for an estimated $700. The old machine has zero book value and will be scrapped for no money. The project will cause an increase in Sales of $7000 in each of years 1 through 3. It is also expected to enhance efficiencies thereby reducing operating expenses by $3000 in each of years 1 through 3. The project will require an increase in Accounts Receivable of $500 and an decrease in Accounts Payable of $1600 up front. The project's impact on these accounts is expected to disappear at project end (in year 3). The firm's marginal tax rate is 40%, and its WACC is 12%. The NPV of this project is $_________.

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