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A farmer must decide whether or not to purchase a new tractor. The tractor will reduce the farmer's annual harvesting costs by $2,000 in the first year, $2,500 in the second year, and $3,000 in the third (the final) year of its usefulness. At the end of the third year, it can be sold for a scrap value of $500. The price of the tractor is $5,500 (due immediately). If the interest rate that can be earned in a savings account is seven percent per year, what is the net present value of the tractor? Selected Answer: b. $1,410. Answers: $1,502. b. $1,410. $2500 $6,910