Question: this is mulit-part question A firm is considering replacing the existing industrial air conditioning unit. They will pick one of two units. The first, the
this is mulit-part question

A firm is considering replacing the existing industrial air conditioning unit. They will pick one of two units. The first, the AC360, costs $26,511.00 to install, $5,160.00 to operate per year for 7 years at which time it will be sold for $6,855.00. The second, RayCool 8, costs $41,927.00 to install, $2,163.00 to operate per year for 5 years at which time it will be sold for $9,092.00. The firms cost of capital is 5.99%. What is the equivalent annual cost of the AC360? Assume that there are no taxes.
A firm is considering replacing the existing industrial air conditioning unit. They will pick one of two units. The first, the AC360, costs $26,926.00 to install, $5,075.00 to operate per year for 7 years at which time it will be sold for $7,114.00. The second, RayCool 8, costs $41,827.00 to install, $2,109.00 to operate per year for 5 years at which time it will be sold for $8,904.00. The firms cost of capital is 6.65%. What is the equivalent annual cost of the RayCool8? Assume that there are no taxes.
A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firms production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $26,536.00 per year for 8 years and costs $98,421.00. The UGA-3000 produces incremental cash flows of $28,546.00 per year for 9 years and cost $125,078.00. The firms WACC is 9.73%. What is the equivalent annual annuity of the GSU-3300? Assume that there are no taxes.
A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firms production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $25,899.00 per year for 8 years and costs $99,128.00. The UGA-3000 produces incremental cash flows of $28,723.00 per year for 9 years and cost $125,044.00. The firms WACC is 7.80%. What is the equivalent annual annuity of the UGA-3000? Assume that there are no taxes.
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