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  3. 4. tiger construction company has purchased a mach

4. Tiger construction company has purchased a machine at the cost of $35,000. The machine...

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4. Tiger construction company has purchased a machine at the cost of $35,000. The machine is expected to provide annual saving of $50,000 for two years and is to be depreciated by the MACRS three-year recovery period. This machine will require annual operating and maintenance costs in the amount of $15,000. The salvage value at the end of two years is expected to be $8,000. a) Assuming a marginal tax rate of 30% and MARR of 10%, fill in the table below. (18 points) b) Assume MARR of 8%, calculate NPV of the project. ( 2 points) 4. Tiger construction company has purchased a machine at the cost of $35,000. The machine is expected to provide annual saving of $50,000 for two years and is to be depreciated by the MACRS three-year recovery period. This machine will require annual operating and maintenance costs in the amount of $15,000. The salvage value at the end of two years is expected to be $8,000. a) Assuming a marginal tax rate of 30% and MARR of 10%, fill in the table below. (18 points) b) Assume MARR of 8%, calculate NPV of the project. ( 2 points)

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