Question $5(1$ point$)$

Unequal Lives. Your company is considering two machines to stamp metal in its factory. Machine A costs $$500,000,$ it has a life of four years, and it will generate after$-$tax cash flows of $$190,000$ each year. Machine B costs $$300,000,$ has a life of three years, and will generate after$-$tax cash flows of $$150,000$ each year. The company's WACC is $13\%$ per year. Calculate Equivalent Annual Annuities $($EAA$\text{'}$s$).$ Which machine should your company purchase?

$A=$$$23,903$;$B=$$$22,943.$ Choose $A$

$A=$$$21,903$;$B=$$$22,943.$ Impossible to determine.

$A=$$$21,903$;$B=$$$22,943.$ Choose $B$

$A=$$$20,000$;$B=$$$22,000.$ Choose $B$

$A=$$$23,903$;$B=$$$22,943.$ Impossible to determine.