A manufacturing firm is considering two models of lathes. Model A will have an initial cost of $29,000, an annual operating cost of $2750, and a salvage value of $6500 after 6 years. Model B will have an initial cost of $36,500, an annual operating cost of $2200, and a $7750 resale value after 12 years. At an interest rate of 10% per year, which model should the consulting firm buy? You may assume repeatability.