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IBM is interested in acquiring some new equipment. Machine A costs $30,000 up front and will last 5 years. It costs $4000 per year to

IBM is interested in acquiring some new equipment. Machine A costs $30,000 up front and will last 5 years. It costs $4000 per year to run. Machine B costs $15,000 up front and will last 2 years. B costs $6000 per year to run. IBM plans to replace the equipment as needed. The 2 machines perform the same function. The interest rate is 12%. Which machine should they choose? And why?

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