XYZ Company is considering purchasing a new piece of equipment that costs $500,000. The equipment has a useful life of 5 years and a salvage value of $100,000. The company expects to generate an additional $200,000 in annual cash flows for the next 5 years from the equipment. The company has a required rate of return of 10%. Should the company make this investment? Show all calculations and provide a clear explanation of your answer.

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