Question: Consider Buying 2 different machines, using i = 8% Machine A Machine B Purchase Cost $10,000 $20,000 Annual Operating Cost $500 $400 Useful Life 4

Consider Buying 2 different machines, using i = 8%

Machine A Machine B

Purchase Cost $10,000 $20,000

Annual Operating Cost $500 $400

Useful Life 4 yr. 12 yr.

Savage Value $0 $5000

Using Present Cost, buy 3 A machines to equate 12 year life.

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