Amazon is considering a new multi$-$year project to test high capacity drones that would

make its product deliveries more efficient and save the company $$145,000$ each year, in

pre$-$tax money. For this four$-$year$-$long project, $$385,000$ would need to be spent right

away to buy the required fleet of drones. The drones will be losing their economic value

according to the MACRS schedule for the five$-$year property class. See Table $10\mathrm{.}7.$

Amazon foresees the need to immediately invest $$20,000$ in a cash reserve which

would then be increased every year by $$3,100.$ At the end of this project, Amazon is

hoping to find a different company that would pay $$45,000$ to buy its used drones.

$22$ percent tax rate applies to Amazon's annual taxable income as well as any of the

company's taxable cash flows. The required return on this investment project

is $9$ percent per year.

The Net Present Value of this project equals

$($Do not round your intermediate

calculations and only round your final answer to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

NPV

Is it worth it to Amazon to buy the drones?

Yes

No