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Office Automation must choose between two copiers, the NA 4 0 or the HA 4 5 . The NA 4 0 costs less than the

 Office Automation must choose between two copiers, the NA40 or the HA45. The NA40 costs less than the HA45, but its economic life is shorter. The initial costs and maintenance expenses of these two copiers are given as follows: COPIER Year 0 Year 1 Year 2 Year 3 Year 4 Year 5NA40 -RM700 -RM100 -RM100 -RM100 - -HA45 -RM900 -RM110 -RM110 -RM110 -RM110 -RM110All cash flows occur at year-end and the discount rate is 12%. Assume that revenues are the same regardless of the copier, and assume that whichever copier the company chooses, it will continue to buy that model forever. The salvage value of NA40 is RM150 while the salvage value of HA45 is RM200. Which copier should the company choose if the tax rate is 24% and the depreciation rate is 50% in the first year, followed by 25% per year thereafter?  

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Choosing the Optimal Copier NA40 vs HA45 To determine the best copier for Office Automation we need to compare their Net Present Values NPVs taking in... blur-text-image

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