Engineering economics, please answer the following. Please show all work. Thanks!

2. (20 points) A machine purchased 9 years ago for $45,000 is expected to have the salvage values and operating costs shown below for additional years of service. It can be sold immediately for $9,000 by placing an ad in a trade magazine. Table 1: Costs for Defender Year, i Operating Cost, Salvage Value at End of Year, $ WN -50,000 6,000 -53,000 4,000 -60,000 1,000 a) Draw a cash flow diagram for option of keeping the Defender for three (3) years. 2 31 $(50,000) $(53,000) $ (60, 000 ) b) The table below shows the present value of keeping the defender for i years at 12% interest. Determine the ESL of the Defender. Calculating discount rate for : (+:)6 PV if keep , 1 = 12 7 Year, i i years n= # of yearsS W N - -48,286 -92, 705 -128,889 1:0. 56 c) A replacement machine will cost $125,000, have a $10,000 salvage value after its 10-year ESL (Economic Service Life), and have an annual operating cost (AOC) of $35,000 per year. At an interest rate of 12% per year, determine the annual worth (AW) of the Challenger for its ESL. d) At an interest rate of 12% per year, determine if the company should replace the defender with the challenger and, if so, when. 3 of 3