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only solve question 14 enough,thx Comparing Mutually Exclusive Projects Suppose in the previous problem that HISC always needs a conveyor belt system; when one wears

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only solve question 14 enough,thx

Comparing Mutually Exclusive Projects Suppose in the previous problem that HISC always needs a conveyor belt system; when one wears out, it must be replaced. Which system should the firm choose now? Comparing Mutually Exclusive Projects Vandalay Industries is considering the purchase of a new machine for the production of latex. Machine A costs $2, 900,000 and will last for six years. Variable costs are 35 percent of sales, and fixed costs are $195,000 per year. Machine B costs $5, 700,000 and will last for nine years. Variable costs for this machine are 30 percent and fixed costs are $165,000 per year. The sales for each machine will be $12 million per year. The required return is 10 percent and the tax rate is 35 percent. Both machines will be depreciated on a straight-line basis. If the company plans to replace the machine when it wears out on a perpetual basis, which machine should you choose? Capital Budgeting with Inflation Consider the following cash flows on two mutually exclusive projects

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