Intro The Fairmont Hotel in San Francisco needs to replace its air conditioning system. There are two alternatives, both of which can do the job equally well: Machine name AC 1 AC 2 Purchase price $40,000 $60,000 Operating cost (end of each year) $14.000 $8,000 Useful life (years) Straight line depreciation to zero over (years) Salvage value at end of useful life $0 4 6 4 6 SO The relevant discount rate is 10% and the marginal tax rate is 35% B- Attempt 1/2 for 10 pts. Part 1 What is the operating cash flow for AC 1 per year? 0+ decimals - Attempt 1/2 for 10 pts. Part 2 What is the equivalent annual cost for AC 1 (in absolute terms)? 0+ decimals Submit Attempt 1/2 for 10 pts Part 3 What is the operating cash flow for AC 2 per year? 0+ decimals Submit Attempt 1/2 for 10 pts Part 4 What is the equivalent annual cost for AC 2 (in absolute terms)? 0+ decimals Submit 8 Attempt 1/2 for 10 pts Part 5 Which AC system should the company buy? The system with the higher equivalent annual cost The system with the lower equivalent annual cost Submit