Jim Pooley operates a hot dog stand in downtown Toronto. He is considering purchasing a new stand that will cost $30,000. The new stand will be more efficient to run and Jim estimates it will save him $5,000 per year in operating costs. The new stand will have a 10-year useful life with a scrap value of $2,500 at the end of year 10. Dave thinks he can sell his old stand now for $1,000.

Required:
Ignore income taxes. Calculate the net present value of the new hot dog stand assuming Dave requires a 7% return.