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Karsted Air Services is now in the final year of a project. The equipment originally cost $ 2 1 million, of which 1 0 0

Karsted Air Services is now in the final year of a project. The equipment originally cost $21 million, of which 100% has been depreciated. Karsted can sell the used equipment today for $7 million, and its tax rate is 25%. What is the equipment's after-tax salvage value? Write out your answer completely. For example, 13 million should be entered as 13,000,000. Round your answer to the nearest dollar.
Faleye Consulting is deciding which of two computer systems to purchase. It can purchase state-of-the-art equipment (System A) for an after-tax cost of $24,000, which will generate after-tax cash flows of $8,000 at the end of each of the next 6 years. Alternatively, the company can purchase equipment with an after-tax cost of $14,000 that can be used for 3 years and will generate after-tax cash flows of $8,000 at the end of each year (System B). If the companys WACC is 10% and both projects can be repeated indefinitely, which system should be chosen, and what is its EAA? Do not round intermediate calculations. Round your answer to the nearest cent.

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