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A) Two machines A & B have different service lives as shown in the figure below. Evaluate which machine you will buy for your company
A) Two machines A & B have different service lives as shown in the figure below. Evaluate which machine you will buy for your company using the concept of least common multiple method of service lives. Model A: 0 1 N 3 $3,000 $4,000 $4,000 $12,500 Model B: 2 0 1 3 $2,500 $5,000 $5,000 $5,000 $15,000 B) Determine the capital recovery cost of purchasing a machine with an initial investment of $50,000 and salvage value of $10,000 at the end of 6 years. What is the annual equivalent worth of this investment if there is an annual maintenance cost associated of $4,000 (assume annual interest rate of 5%)
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