Question: C) Lastly, using the net present value as the basis of comparing the machines, Tim should recommend .? Score: 1 of 3 pts 4 of
C)
Lastly, using the net present value as the basis of comparing the machines, Tim should recommend .?
Score: 1 of 3 pts 4 of 4 (4 complete) HW Score: 80%, 8 of 10 pts %) Problem S7.37 Question Help Tim Smunt has been asked to evaluate two machines. After some investigation, he determines that they have the costs shown in the following table: Original Cost Labor per year Maintenance per year Salvage value Machine A $15,000 $2,200 $4,000 $2,400 Machine B $20,000 $4,400 $1,200 $7,200 He is told to assume that: 1. The life of each machine is 3 years. 2. The company thinks it knows how to make 12% on investments no more risky than this one. 3. Labor and maintenance are paid at the end of the year. The NPV for Machine A = $ - 28183 (round your response to the nearest whole number and include a minus sign if necessary). The NPV for Machine B = $ (round your response to the nearest whole number and include a minus sign if necessary)Step by Step Solution
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