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Robot A costs $10,000 and requires $1,000 per year in maintenance. It will last for 3 years before becoming obsolete and you will need to

Robot A costs $10,000 and requires $1,000 per year in maintenance. It will last for 3 years before becoming obsolete and you will need to purchase another Robot A. Robot B costs $14,000 and requires $700 per year in maintenance. It will last 4 years before another Robot B will need to be purchased. Which robot has the lower equivalent annual cost if your r is 10% and what is the EAC of that robot?

  • Robot B: -3,569

  • Robot B: -4,200

  • Robot A: -3,763

  • Robot A: -4,333

  • Robot A: -5,021

  • Robot B: -5,117

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