Calculate the net present value of this machine

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Question - (Ignore income taxes in this problem.) The Whitton Company uses a discount rate of 16%. The company has an opportunity to buy a machine now for $18,000 that will yield cash inflows of $10,000 per year for each of the next three years. The machine would have no salvage value. The net present value of this machine to the nearest whole dollar is:

a. $22,460.

b. $4,460.

c. $(9,980).

d. $12,000.

Reference no: EM131799150

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