Questions...? Machine A Machine B - Life of each machine is 3 years Original cost 13000 20000 - The company thinks it knows how to make 14% on 1 - Labor cost per year 2000 3000 investments and no riskier than 2 - Floor space per year 500 600 this one (i = 0.14) - Determine via the present 3 - Electricity per year 1000 900 value method, which machine to purchase? 4 - Maintenance 2500 500 Total annual cost 6000 5000 (1+2+3+4) Salvage revenue 2000 7000