Question: 2: BigPizza is considering a replacement for their current oven. The oven has a salvage value now of $5000, which will fall to $4000 by

2: BigPizza is considering a replacement for their current oven. The oven has a salvage value now of $5000, which will fall to $4000 by the end of the year. The cost of lower productivity linked to the current oven is $3000 this year. A potential new oven costs $12,000 and has the following salvage values and lost productivity for each year:

Year Salvage Lost Productivity

0 $12,000

1 9,000 $ 0

2 7,000 1000

3 5,000 2000

4 3,000 3000

BigPizza uses an interest rate of 15%.

Find the EUAC for each of the next 4 years by completing the table below for the challenger: What is the EUAC at Year 4?

Year	Market Value	Loss in Market Value	Interest in Year N	Lost Productivity	Marginal Costs	PW of Costs	EUAC
0
1
2
3
4

Answer: < 16 pts>

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