The annual equivalent after-tax costs of retaining a defender machine over four years (physical e) or operating

Question:

The annual equivalent after-tax costs of retaining a defender machine over four years (physical e) or operating its challenger over six years (phys-life) are as given in Table PI4.22.
TABLE PI4.22

If you need the service of either machine for only the next 10 years, what is the best replacement strategy? Assume a MARR of 12% and no improvements in technology in future challengers.

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...