Question: Two alternative machines are being considered for a manufacturing process. Machine A has an initial cost of $75,200, and its estimated salvage value at the

Two alternative machines are being considered for

Two alternative machines are being considered for a manufacturing process. Machine A has an initial cost of $75,200, and its estimated salvage value at the end of its six years of service life is $21,000. The operating costs of this machine are estimated to be $6,800 per year. Extra income taxes are estimated at $2,400 per year. Machine B has an initial cost of 544,000, and its salvage value at the end of its six years of service life is estimated to be negligible. Its annual operating costs will be $11,500. Compare these two alternatives by the present-worth method at i = 13%

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