Question: You are considering two machines, A and B that can be used for the same puroose. Machine A costs $250,000, will reduce costs by $70,000

 You are considering two machines, A and B that can be

You are considering two machines, A and B that can be used for the same puroose. Machine A costs $250,000, will reduce costs by $70,000 per year, needs net working capital of $20,000 at time zero which be released at the end of the project, has a 5 year straight line depreciable life and can be sold at the end of the project's life for $50,000. Machine B costs $320,000, will reduce costs by the same $70,000 per year, has net working capital of $40,000 at time zero (also released at the end of its life), has a ten year straight line depreciable life and can be sold at the end of its life for $60,000. Assume that the tax rate is 38% and the discount rate is 10 %. What are the net present values for these two projects? O $7,045.82 for A and $39,542.1 for B O $3,704.49 for A and $24,333.2 for B $1,787.92 for A and $11,56.09 for B O $2,486.55 for A and $21,421.13 for B

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