Question: A machine that has been used for one year has a salvage value of $16,000 now. The salvage value will drop by $3,000 per year.

A machine that has been used for one year has a salvage value of $16,000 now. The salvage value will drop by $3,000 per year. The maintenance costs for the next four years are $1,250, $1,450, $1,750 and $2,250. Determine the marginal cost to extend services for each of the next 4 years if the MARR is 10 pct.

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