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Octavia bakery is planning to purchase one of two ovens. The expected cash flows for each oven are shown below. The MARR is 10% per
Octavia bakery is planning to purchase one of two ovens. The expected cash flows for each oven are shown below. The MARR is 10% per year.
Initial Investment Estimated Life End of Life Salvage Annual Income Annual Expense Model 127B $55,000 10 years $10,000 I $19,400 $10,000 Model 334A $85,000 15 years $0 $26,000 $6,000 A. What is the present worth, future worth, and annual worth of each investment? (Note: You may assume identical replacement with same cost, performance, etc.) B. Which Oven should Octavia purchase Step by Step Solution
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