=+8. A divisional manager is considering the following two machines, each of which has an initial cost of f800000 and an optimal usefullife of four years, with an estimated scrap value of zero.

The machines produce constant outputs from year to year:

Machine I Machine II Annual operating costs in each of years 1 to 4 Operating costs: Year 1 2

3 4

f 247600 100000 200000 340000 400000