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Cameron Industries is purchasing a new chemical vapor depositor in order to make silicon chips. It...

Cameron Industries is purchasing a new chemical vapor depositor in order to make silicon chips. It will cost $ 6 comma 000 comma 000 to buy the machine and $ 10 comma 000 to have it delivered and installed. Building a clean room in the plant for the machine will cost an additional? $3 million. The machine is expected to raise gross profits by $ 4 comma 500 comma 000 per? year, starting at the end of the first? year, with associated costs of? $1 million for each of those years. The machine is expected to have a working life of six years and will be depreciated over those six years. The marginal tax rate is? 40%. What are the incremental free cash flows associated with the new machine in year? 2?

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jeff jeffy answered 2 years ago
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