2. (15 pts) You are comparing two mortgage offers. Option A has an interest rate of 3.78% per year compounded monthly. Option B has an interest rate of 3.65% per year compounded every two weeks. Which is the better offer? You must show your work to get credit for this problem. 3. (15 pts) A piece of equipment has to be replaced immediately because it can no longer meet the tolerance requirements for the end product. The two best altematives are a semi-automated model (A) and a fully automated model (B). The cash flow estimates for each are shown below. Capital Investment Annual Expenses Useful Life (years) $48,000 $65,000 $14,000 SIO,ooo 10 15 If your company's MARR is 18% per year, which altemative should you choose?