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A special purpose machine is to be purchased at a cost of $15,000. The following table shows the expected annual operating and maintenance cost and
A special purpose machine is to be purchased at a cost of $15,000. The following table shows the expected annual operating and maintenance cost and the salvage values for each year of service. Year of Service O&M Costs Market Value 1 $2,500 $12,000 2 3,200 8,100 3 5,300 5,200 4 6,500 3,500 5 7,800 0 a) If the interest rate is 10%, what is the economic service life for this machine? b) Repeat (a) above using i=15%. show with formula on excel
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