Question: You are considering buying a machine that will cost you
You are considering buying a machine that will cost you $12,000. There will be a maintenance cost of $1,000 at the beginning of each year, and the machine will generate cash flows of $5,000 over the next five years. After the five years, the machine will have no salvage value. What is the NPV of this machine if the cost of capital is 12 percent?
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