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You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $220,000. The truck falls

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You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $220,000. The truck falls into the MACRS 3-year class, and it will be sold after 3 years for $22,000. Use of the truck will require an increase in NWC (spare parts inventory) of $5,200. The truck will have no effect on revenues, but it is expected to save the firm $100,000 per year in before-tax operating costs, mainly labor. The firm's marginal tax rate is 40 percent. What will the cash flows for this project be during year 2? Multiple Choice $2,210 $99,116 $94,800 $157,790

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