Suppose Agaves is considering the purchase of a new industrial dishwasher. The unit cleans faster and uses less labor and less water, but it costs $10,000. Should the restaurant make the capital expenditure, or would it be better off saving the money and incurring higher operating costs? To help decide what Agaves should do, consider this information: the dishwasher has a usable life of five years before it will need to be replaced. It will save the restaurant $300 a year in water and 10 hours of labor each week. Human dishwashers are currently paid $8 per hour.

QUESTION: Should Agaves purchase the new dishwasher?