Question: A. You can continue to use your less efficient machine at a cost of $20,000 annually for the next five years. Alternatively, you can purchase

A. You can continue to use your less efficient machine at a cost of $20,000 annually for the next five

years. Alternatively, you can purchase a 5-year more efficient machine for $30,000 plus $10,000

annual maintenance. At a cost of capital of 15%,

The EAC of the new machine will be ........................... than that of the old machine by $..............................

greater/lower

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