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Upgrading the old machine

Last response: in Graphics & Displays
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I have an old Sony P4 2.8 with 512 RAM and an FX5200 AGP graphics card. I have been attempting to watch 720p videos and HD online content. It's clear that this machine isn't particularly up to the task. I am planning on putting 2GB of ram in it, but should I also upgrade the graphics card? My budget is $200 and I am able to run Windows XP or 7 (32bit).

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