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Ruff Motors needs to select an assembly line for producing their new SUV. They have two options: Option A is a highly automated assembly line

Ruff Motors needs to select an assembly line for producing their new SUV. They have two options:
Option A is a highly automated assembly line that has a large up-front cost but low maintenance
cost over the years. This option will cost $9 million today with a yearly operating cost of $3 million.
The assembly line will last for 5 years and be sold for $6 million in 5 years.
Option B is a cheaper alternative with less technology, a longer life, but higher operating costs.
This option will cost $7 million today with an annual operating cost of $2.3 million. This assembly
line will last for 8 years and be sold for $1 million in 8 years.
The firms cost of capital is 11.4%. Assume a tax rate of zero percent.
47. The equivalent annual cost (EAC) for Option A is $_______million.
48. The equivalent annual cost (EAC) for Option B is $_______million.

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