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A company's management is trying to determine the best time to replace a piece of equipment. The installed cost of a new one has been
A company's management is trying to determine the best time to replace a piece of equipment. The installed cost of a new one has been relatively constant at $80,000. Average expenses per year and MVs as a function of age after installation are shown below. Determine the best time to replace the old equipment if the MARR is 15% per year? (25 points) Year 1 3 4 Annual expenses MV 30,000 60,000 2 30,000 50,000 35,000 40,000 40,000 25,000 5 45,000 12,500
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