Question 2 (10 points): GM is considering a four-year project to improve its production efficiency. Buying a new machine for $405,000 is estimated to result in $170,000 in annual pretax cost savings. The machine falls in the MACRS five-year class, and it will have a salvage value at the end of the project of $25,000. The machine also requires an initial investment in spare parts inventory of $35,000, along with an additional $3,000 in inventory for each succeeding year of the project. If the shop's tax rate is 31 percent and its discount rate is 12 percent, should the company buy and install the machine? (30 points)