The Whitton Company uses a discount rate of 16%. 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) $4,460.
B) $22,460.
C) ($9,980) .
D) $12,000.

To calculate the net present value (NPV) of the machine, we need to discount each of the cash inflows back to their present value using the given discount rate of 16%. The formula for the present value (PV) of a single cash flow is PV = FV / (1 + r)^n, where FV is the future value of the cash flow, r is the discount rate, and n is the number of periods.Year 1 inflow: $10,000 / (1 + 0.16)^1 = $8,620.69Year 2 inflow: $10,000 / (1 + 0.16)^2 = $7,431.96Year 3 inflow: $10,000 / (1 + 0.16)^3 = $6,407.76Sum of present values = $8,620.69 + $7,431.96 + $6,407.76 = $22,460.41Net present value (NPV) = Sum of present values - Initial investmentNPV = $22,460.41 - $18,000 = $4,460.41Rounded to the nearest whole dollar, the NPV is approximately $4,460, which matches choice A.