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Suppose a theater organization is going to purchase new sound equipment for its auditorium. Option A has a net present cost of $40,000 and a
Suppose a theater organization is going to purchase new sound equipment for its auditorium. Option A has a net present cost of $40,000 and a useful life of 6 years; Option B has a net present cost of $35,000 and a useful life of 5 years. Both options involve annual maintenance costs which are included in their respective net present costs. If the organization uses a discount rate of 3.5%, it should purchase: Question 6 options: Option A Option B
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