Please analyze both designs and choose the best one.

A firm must decide between two silicon layer chip designs from Intel. Their effective income tax rate is 40%, and MACRS depreciation is used. If the desired after-tax return on investment is 10% per year, which design should be chosen? Capital investment MV at end of useful life Annual revenues less expenses MACRS property class Useful life Design A $1,110,000 $1,090,000 $260,000 5 years years Design B $1,940,000 $1,060,000 $450,000 5 years years Click the icon to view the GDS Recovery Rates (rk) for the 5-year property class Click the icon to view the interest and annuity table for discrete compounding when the MARR is 10% per year