Projects with different lives: You are starting an Italian restaurant and need to buy a motorcycle for delivery orders. You have two models in mind. Model A costs $9000 and is expected to run for 6 years; model B is more expensive, with a price of $14 000 and an expected life of 10 years. The annual maintenance costs are $800 for model A and $700 for model B. Assume that the opportunity cost of capital is 10 per cent.

Which one should you buy using (a)the NPVperpetuity method and (b)theEAC method?

show me how do both methods work