Question: Two alternative machines, A and B, as being considered as replacements for an older, worn-out machine. The cash flows for the two mutually exclusive alternatives

 Two alternative machines, A and B, as being considered as replacements

Two alternative machines, A and B, as being considered as replacements for an older, worn-out machine. The cash flows for the two mutually exclusive alternatives are presented in the following table; the MARR is 12%. Select the best alternative using the NPV criterion. Machine A Machine B End of Year 0 -$20,000 -$28,000 1 $ 4,864 $8,419 2 $ 4,864 $8,419 3 $ 4,864 $8,419 4 $ 4,864 $8,419 5 $ 4,864 $8,419 6 $ 4,500 $8,419

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