=+Machine A would have to be replaced by an identical machine on a two-year cycle. Machine B would be replaced by an identical machine every three years. It is considered reasonable to assume that the cash flows for the future replacements of A and B are the same as in the above table. The opportunity cost of capital for Hazel is 15 per cent. Ignore taxation. The acceptance of either project would leave the company's risk unchanged. The cash flows occur on anniversary dates.

Required Calculate the net present value of Machine A for its two-year life.
a b