Generic machine buying decision The firm you work for requires a particular type of machine for its production process. The firm can choose between two competing models of the machine produced by different companies. Model A costs $10,000 to buy and would increase revenues by S7,000 per year. It would cost $1,000 per year to operate the machine and the machine is expected to last for 5 years before it must be replaced After 5 years, the machine can be sold for scrap metal for $1,000. Model B costs S13,000 to buy and would increase revenues by 86,000 per year. It would cost $1,000 per year to operate the machine and the machine is expected to last for 7 years before it must be replaced. After 7 years, the machine can be sold for scrap metal for $1,000. Whichever machine is chosen, it will fall in an asset class that with a CCA rate of 10%. The firm has millions of dollars of other assets in this class. The firm is subject to a 40% tax rate and a 10% required rate of return. Which model of the machine should the firm choose? Generic machine buying decision The firm you work for requires a particular type of machine for its production process. The firm can choose between two competing models of the machine produced by different companies. Model A costs $10,000 to buy and would increase revenues by S7,000 per year. It would cost $1,000 per year to operate the machine and the machine is expected to last for 5 years before it must be replaced After 5 years, the machine can be sold for scrap metal for $1,000. Model B costs S13,000 to buy and would increase revenues by 86,000 per year. It would cost $1,000 per year to operate the machine and the machine is expected to last for 7 years before it must be replaced. After 7 years, the machine can be sold for scrap metal for $1,000. Whichever machine is chosen, it will fall in an asset class that with a CCA rate of 10%. The firm has millions of dollars of other assets in this class. The firm is subject to a 40% tax rate and a 10% required rate of return. Which model of the machine should the firm choose