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(5 points) A factory produces blood test kits. In order to expand the production, the manamgent is considerating purchasing a new Green machine that costs
(5 points) A factory produces blood test kits. In order to expand the production, the manamgent is considerating purchasing a new Green machine that costs $109,200, has a lifetime of 4 years, and a salvage value of $16,900. The machine's annual maintenance cost is $1,000. Assume throughout this question that the cost of capital is 2.55% a) Find the Green machine's capitalized cost. Answer = $ b) How much profit should the Green machine generate per year, at the minimum, to economically justify the purchase? Answer = $ The management also has a quote for a Blue machine, which costs $117,600, has a lifetime of 9 years, and a salvage value of $13,100. c) Let X denote the annual maintenance cost of the Blue machine. Express the Blue machine's capitalized cost in terms of X Answer = Help: Entering formula d) How much can the Blue company charge for annual maintenance to make its machine as economic as the Green one? Answer = $ (5 points) A factory produces blood test kits. In order to expand the production, the manamgent is considerating purchasing a new Green machine that costs $109,200, has a lifetime of 4 years, and a salvage value of $16,900. The machine's annual maintenance cost is $1,000. Assume throughout this question that the cost of capital is 2.55% a) Find the Green machine's capitalized cost. Answer = $ b) How much profit should the Green machine generate per year, at the minimum, to economically justify the purchase? Answer = $ The management also has a quote for a Blue machine, which costs $117,600, has a lifetime of 9 years, and a salvage value of $13,100. c) Let X denote the annual maintenance cost of the Blue machine. Express the Blue machine's capitalized cost in terms of X Answer = Help: Entering formula d) How much can the Blue company charge for annual maintenance to make its machine as economic as the Green one? Answer = $
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