Machine A was purchased three years ago for $10,000 and had an estimated market value of $1,000

Question:

Machine A was purchased three years ago for $10,000 and had an estimated market value of $1,000 at the end of its 10-year life. Annual operating costs are $1,000. The machine will perform satisfactorily for the next seven years. A salesman for another company is offering Machine B for $50,000 with an market value of $5,000 after 10 years. Annual operating costs will be $600. Machine A could be sold now for $7,000, and is 9% per year. Using the outsider viewpoint, what is the difference in the equivalent uniform annual cost (EUAC) of buying Machine B compared to continuing to use Machine A; i.e., EUAC(Machine B)
MARR
Minimum Acceptable Rate of Return (MARR), or hurdle rate is the minimum rate of return on a project a manager or company is willing to accept before starting a project, given its risk and the opportunity cost of forgoing other...