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Your company is deciding whether to invest in a new machine. The new machine will increase cash flow by $321,000 per year. You believe the
Your company is deciding whether to invest in a new machine. The new machine will increase cash flow by $321,000 per year. You believe the technology used in the machine has a 10-year life: in other words, no matter when you purchase the machine. It will be obsolete 10 years from today. The machine is currently priced at $1, 710,000. The cost of the machine will decline by $106,000 per year until It reaches $1, 180,000, where it will remain. If your required return is 13 percent, calculate the NPV if you purchase the machine today. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV $31, 824 If your required return is 13 percent calculate the NPV if you wait to purchase the machine until the indicated year. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Should you purchase the machine
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