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rate of $ 4 0 0 , 0 0 0 per year. It will be completely written off in three years. If we don t

rate of $400,000 per year. It will be completely written off in three years. If we dont replace it now, we will have to replace it in two years. We can sell it now for $603,000; in two years, it will probably be worth $177,000. The new machine will save us $377,000 per year in operating costs. The tax rate is 21 percent, and the discount rate is 8 percent.
a-1. Calculate the EAC for the the old computer and the new computer.
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g.,32.16.
a-2. What is the NPV of the decision to replace the computer now?
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g.,32.16.

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