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If there's no leakage or discoloration in the fluid then yes, it very well could be your master cylinder. Crawl up underneath your firewall and look for the pushrod going from your brake pedal assembly through the wall into the master cylinder. Make sure there's no leakage there. Sometimes when MC's die, they like to piddle a little fluid back through the firewall into the carpet, which loves to eat paint.
You can obtain rebuilt MC's for cheap or a rebuild kit for even cheaper if you don't mind an afternoon project.
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