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Byec, a platics proctssce, is considering the purchase of a high-speed extruder as one cotion. The new extruder would cost $50,000 and would have a

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Byec, a platics proctssce, is considering the purchase of a high-speed extruder as one cotion. The new extruder would cost $50,000 and would have a residual value of $3000 at the end of tis 6 year ife. The anvul operating eopenses of the new extruder would be 35000 . The ocher option that Byer has is fo robuld is culsting exingler. The rebelding would requie an levestment of $30000 and would extend the the of the exlating oxiruder by 6 years. The existing extruder has arinual operating costs of 312000 per year and does not heve a residusi value. Byer's discount rate is 12\%. Ueing net present value analysis. which option is the better coplon and by herw much? vener oy 514,409 bo rebuld existing extrider Betler by 514,400 to purchase new extruder Better by $12.88 to rebild evising extruder Beber by 512.864 to purchase new extruder

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