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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