PS:33

A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firms production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $24,038.00 per year for 8 years and costs $99,100.00. The UGA-3000 produces incremental cash flows of $28,545.00 per year for 9 years and cost $123,595.00. The firms WACC is 9.13%. What is the equivalent annual annuity of the GSU-3300? Assume that there are no taxes.