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For a MARR of 12%, which of the two mutually exclusive machines should be selected? Machine A Machine B Initial cost $450,000 $476,000 Life in

For a MARR of 12%, which of the two mutually exclusive machines should be selected?

Machine A Machine B
Initial cost $450,000 $476,000
Life in years 6 6
Salvage after life 12% 18%
Benefits per year $84,000 $94,000
Costs per year $12,900 $26,800
Inflation 3%
Increase in benefits 7%

Machine A.

Machine B.

Either machine will be fine.

None of the machine are good enough. Both should be rejected.

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