Machines A and B are mutually exclusive and are expected to produce the following cash flows: The opportunity cost of capital is $10$ percent.

Machine C$0$ C$1$ C$2$ C$3$

A $-100110121$

B $-120110121133$

$($a$)$ Calculate the NPV of each machine.

$($b$)$ Use present value table to calculate the equivalent annual cash flow from each machine. Which machine should you buy?

$($c$)$ Now machine C was purchased two years ago for $$90$ and produces an annual cash flow of $$80.$ It has no salvage value but it is expected to last another two years. The company can replace machine C with machine B either now or at the end of two years. What should it do$?$