Problem:
Muncy, Inc., is looking to add a new machine at a cost of $4,133,250. The company expects this equipment will lead to cash flows of $816,822, $863,275, $937,250, $1,018,610, $1,212,960, and $1,225,000 over the next six years.
Required:
Question 1: If the appropriate discount rate is 15 percent, what is the NPV of this investment?
Note: Explain all calculation and formulas.