because of inflation, a company must replace one of its (fully depreciated) machines at twice the nominal

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because of inflation, a company must replace one of its (fully depreciated) machines at twice the nominal price paid for a similar machine 8 years ago. Based on present accounting rules, will the company have covered the entire cost of the new machine through depreciation charges? Explain by contrasting accounting and economic costs.
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Managerial Economics

ISBN: 978-0133020267

7th edition

Authors: Paul Keat, Philip K Young, Steve Erfle

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