Question: You are thinking about buying a new machine or a used one. Because the projects don't have equal lives you decide to calculate the

You are thinking about buying a new machine or a used one.

You are thinking about buying a new machine or a used one. Because the projects don't have equal lives you decide to calculate the Equivalent Annual Annuity of the used machine, whose cashflows are below. If your opportunity cost of capital is 9%, what is the Equivalent Annual Annuity (EAA) of the used machine? Year Used machine t = 0 -700 1 +200 2 +250 3 +280 4 +320

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