X Company is considering replacing one of its machines in order to save operating costs. Operating costs with the current machine are $60,000 per year; operating costs with the new machine are expected to be $44,000 per year. The new machine will cost $70,000 and will last for 6 years, at which time it can be sold for $4,000. The current machine will also last for 6 more years but will have zero salvage value. Its current disposal value is $5,000.

X Company is considering replacing one of its machines in order to save operating costs. Operating costs with the current machine are $60,000 per year; operating costs with the new machine are expected to be $44,000 per year. The new machine will cost $70,000 and will last for 6 years, at which time it can be sold for $4,000. The current machine will also last for 6 more years but will have zero salvage value. Its current disposal value is $5,000. Assuming a discount rate of 8%, what is the net present value of replacing the current machine? [Note: For the capital budgeting questions, use the Present Value tables in the Coursepack or with the link after the last exam question.] OA: $5,882|OB: $7,352 OC: $9,190 OD: $11,488 | OE: $14,360 OF: $17,950 Submit Answer Tries 0/99