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A company is considering the purchase of new, more efficient equipment. Which system should be purchased if i = 11% and N = 20 years?

A company is considering the purchase of new, more efficient equipment. Which system should be purchased if i = 11% and N = 20 years?

System First Cost Annual Operating Costs Annual Savings
System A $100,000 $100,000 $122,000
System B $135,000 $100,000 $128,000

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