You are using a model Mk.4 widget maker for your factory. This machine had an initial cost of $200,000. You bought this machine 4 years ago. Its initial salvage value at the end of useful life was determined to be $20,000. You depreciated it on a straight line at the rate of $22,500 per year. The machine had an expected useful life of 8 years. If you dispose this machine today you can sell it for $65,000. There is a new model Mk.5 widget maker in the market. The new machine will cost you $350,000. The machine is more efficient and you think it will result in cost savings of $85,000 per year and you expect that cost savings will increase by 5% every year. This new machine will have a 5 year useful life and you will depreciate it using 3 year MACRS depreciation schedule. After 5 years this machine will have a salvage value of $15,000, If your required return is 14% and your tax rate is 29%, should you replace the old Mk.4. with the new Mk.5