Question: Will you please explain how to solve this question Example 1. Consider Buying 2 different machines, using i = 8% Machine AMachine B Purchase Cost$5,000$10,000

Will you please explain how to solve this question

Example 1. Consider Buying 2 different machines, using i = 8%

Machine AMachine B

Purchase Cost$5,000$10,000

Annual Operating Cost$500$200

Useful Life5 yr.15 yr.

Savage Value$600$1000

Using Equivalent Annual Worth, since lifecycles are different:

Machine A = 5000(_____________)+ _______-600(___________)

= 5000 (_________) + ______ - 600(_______) = ______

Machine B = 10000 (__________) + ____ - 1000 (__________)

= 10000 (______) + _____ - 1000 (_______) = ________

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