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this is the background information A supermarket can purchase an automated checkout machine for $100,000 (to be paid in year 0) that has an estimated
this is the background information
A supermarket can purchase an automated checkout machine for $100,000 (to be paid in year 0) that has an
estimated life of 5 years. Servicing and maintenance over that period will begin at $2,500 per annum (at the end
of year 1) and increase at a 10% rate every year. If the checkout machine is purchased, the supermarket will not
be required to hire one additional checkout operator. The checkout operator costs $28,000 per year (assume this
is also at the end of each year beginning with year 1), and this amount is expected to increase at 5% annually. If
the supermarket's cost of capital is 10%, which alternative should be selected. Assume all annual cashflows occur
at the end of each year
and this is the question you only need to answer
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