Machine replacement decision Differential Analysis

Continue with $($Alt$.1)$ or Replace $($Alt$.2)$ Old Machine

December $10$

TOrck My Wion subtracting alternative $1$ from alternative $2.$

a$.2$ Determine whether to continue wich $($Alternative $1)$ or replace $($Altemative $2)$ the old machine.

Replace the old machine

Feedook

TOeck My Work

Compare the differential revenues and differential costs of continuing vs$.$ replacing. Which one has the greatest positive differential effect on income?

b$.$ What is the sunk cost in this situation?

The sunk cost is $5$