A new, more efficient machine will last four years and allow inventory levels to decrease by $100,000 during its life. At a cost of capital of 13 percent, how does the net working capital change affect the project's NPV?
A) NPV increases by $100,000
B) NPV increases by $38,668
C) NPV increases by $61,330
D) NPV increases by $138,668
Answer: B) NPV increases by $38,668
Business
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Indicate whether the statement is true or false.
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