You are contemplating the purchase of a new car and feel that by estimating and analyzing its cash flows you could make a more rational decision

about whether to make this large purchase. Your cash flow estimates for the car purchase are as follows:

$*$ Negotiated price of new car $$21,000$

$*$Taxes and fees on new car purchase $$1,650$

$*$Proceeds from sale of old car $$1,050<--$ Ignore any tax consequences from this sale

$*$Estimated value of new car in $3$ years $$8,000\}<--$ Ignore any tax consequences from this sale

$*$Estimated value of old car in $3$ years $$6,200\}<--$ Ignore any tax consequences from this sale

$*$Estimated annual repair costs on new car $$0($since it is in warranty$)$

$*$Estimated annual repair costs on old car $$3,500$

Using the cash flow estimates, you want to calculate the initial investment, operating cash inflows, and terminal cash flow. Using this find the NPV for the new car purchase if your cost of capital $($or discount rate$)$ is $9\%.$