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Geary Machine Shop is considering a four-year project to improveits production efficiency. Buying a new machine press for$1,142,400 is estimated to result in $380,800 in annual pretax costsavings. The press falls in the MACRS five-year class (MACRSTable), and it will have a salvage value at the end of the projectof $166,600. The press also requires an initial investment in spareparts inventory of $47,600, along with an additional $7,140 ininventory for each succeeding year of the project. Required :If the shop's tax rate is 31 percent and its discount rate is 13percent, what is the NPV for this project? (Do not roundyour intermediate calculations.)
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