Consider the following two machines a company can purchase. The following table provides the costs of the machines and the annual cash flows obtained from the machines over their lifetimes.

Initial Cost Cash Inflows per year Years of Service

Machine A $$18,000$ $$7,0007$

Machine B $$5,000$ $$15,0003$

The discount rate is $5\%.$

What is the net present value for each machine?

Machine A $=$

$-12577\mathrm{.}3$

Correct response: $22,504\mathrm{.}61\backslash$pm $2$

Machine B $=$

$-914$

Correct response: $35,848\mathrm{.}72\backslash$pm $2$

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This question has $3$ parts $($i$.$e$.,$ you will need to click "verify" $3$ times$)$

Given that Machine A has an NPV of $$22,504\mathrm{.}61$ and Machine B has an NPV of $$35,848\mathrm{.}72,$ what are the equivalent annual cash flows for each machine?

EACA$=$

Number

EACB$=$

Number

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