Exercise 2: Compare the machines shown on the basis of their capitalized costs and an interest rate of 10% per year to determine which of these mutually exclusive alternatives is economically the best. Machine A Machine B First cost 200,000 800,000 Annual operating cost 40,000 in year 1 and increasing by . 12,000 1,000 unt11 year 8 Salvage value 25,000 1,000,000 Life in ears 8 00