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Two options are presented to a company. Both options have a first cost of $20K. Option A has an annual cash flow of $5K for
Two options are presented to a company. Both options have a first cost of $20K. Option A has an annual cash flow of $5K for 6 years. Option B has cash flows that begin at $3K and that increases by $1K per year for a 6-year life. If the company uses 12% as its cost of money, which option should you recommend?
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