Question: COMPARE TWO UNITS, A AND B. A HAS A NEW COST OF $42 000, A LIFE EXPECTANCY OF 14 YEARS, A SALVAGE VALUE OF $4

COMPARE TWO UNITS, A AND B. A HAS A NEW COST OF $42 000, A LIFE EXPECTANCY OF 14 YEARS, A SALVAGE VALUE OF $4 000, AND AN ANNUAL OPERATING COST OF $3 000.B HAS A NEW COST OF $21 000, A LIFE EXPECTANCY OF 7 YEARS, A SALVAGE VALUE OF $2 000, AND AN OPERATING COST OF $5 000. ASSUME AN ANNUAL INTEREST RATE OF 7%. WHICH OF THE TWO UNITS WOULD YOU RECOMMEND? WHAT INITIAL COST OF MACHINE A WOULD MAKE THE TWO MACHINES IDENTICAL IN OVERALL COST?

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