A low volume office copying machine was purchased 2 years ago for $700. At the fime of purchase it was believed that the machine would have an economic life of 5 years and a salvage value of $100. Operating costs over the first 2 years for material, labor, and maintenance have average $4,200 annually and are expected to continue at the same level. Some type of copier will be needed for the next several years. The same company that manufactures the presently used copying machine has a new model which costs $1,000 but will perform the current work load with operating costs of $3,500 per year. They are offering $300 for the old model as a trade in on the new machine. The expected salvage value for the new model is $200 at the end of 10 years. If the minimum acceptable rate of return is 10 percent before taxes, what is the equivalent annual worth of the existing (defender) machine?

-$300

+$4,290

-$700

-$4.290