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33-35: A company is planning to purchase one of two machines. The expected cash flows for each machine are shown below. MARR is 10% per
33-35: A company is planning to purchase one of two machines. The expected cash flows for each machine are shown below. MARR is 10% per year. Based on annual worth analysis and one-shot investment, answer the following questions Alternative 1 Alternative 2 Initial investment SR 100,000 SR 200,000 Expected life 5 years 7 years Salvage Value SR 25,000 0 Annual Income SR 50,000 SR 65,000 Annual Expense SR 20,000 SR 10,000 33) Based on the above information, what is the annual worth of the first alternative? A) 6,007 B) 5,229 C) 7,120 D) 3,397 34) Based on the above information, what is the annual worth of the second alternative? A) 10,973 B) 12, 609 C) 13,919 D) 14,442 35) If we assume it is individual life cycle instead of one-shot investment, where will be the change in the annual worth value? A) In Alternative 1 B) In alternative 2 C) There will be no change D) More information is needed to
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