Question: A $ 8 2 , 0 0 0 machine with a 7 - year class life was purchased 2 years ago. The machine will now

A $82,000 machine with a 7-year class life was purchased 2 years ago. The machine will now be sold for $33,000 and replaced with a new machine costing $59,000, with a 5-year class life. The new machine will not increase sales, but will decrease operating costs by $16,000 per year. Simplified straight line depreciation is employed for both machines, and the marginal corporate tax rate is 34 percent. What is the initial outlay for the project?

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