For a MARR of 12%, which one of the two mutually exclusive machines should be selected? The increase in costs and benefits trend does not change when a new machine is put into action (The cost keep rising at 3% every year and the benefits increase by 7% every year for the 12 year project life).

	Machine A	Machine B
Initial cost	$650,000	$276,000
Life in years	12	6
Salvage after life	12%	18%
Benefits per year	$134,000	$114,000
Costs per year	$12,900	$16,800
Inflation	3%
Increase in benefits	7%

		Machine A.
		Machine B.
		Either machine will be fine.
		None of the machine are good enough.