You purchased a machine that has initial cost of $150k. It has a 30-year life span after which it will sell for $50k. The machine will bring in $10k each year in revenue, but maintenance will cost $2k/year. There is a gradient cost of $500 the first year and then increase by $100/year. It also needs a huge overhaul at year 15 that will cost $75k. 

 

Draw the Cash Flow Diagram. Also, provide the annual worth of the machine with the interest rate of 4%. All your work to get partial/full credit?

Answer rating: 100% (QA)

To draw the cash flow diagram we can visualize the cash inflows and outflows over the 30year life sp... View the full answer