1. What is the maximum amount a company would be willing to pay today to purchase a

machine if it is expected to provide annual savings of $10,000 for 10 years and to have a

resale value of $25,000 at the end of that period? Assume the business wants to earn 5% on its investment and that the annual savings are realized at year end.

Please show all of the factors used in the calculation PV, I/Y, N, etc. NOT just the answer.

If the calculation involves an annuity, please indicate if it is an ordinary annuity or an annuity due.