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You are considering replacing your old 3D printer with a new one. The current machine is expected to last 3 more years but faces repairs
You are considering replacing your old 3D printer with a new one. The current machine is expected to last 3 more years but faces repairs costs of $2,500 in year 1, $3,500 in year 2, and $4,000 in year 3. You could salvage this machine today for $5,000. A new 3D printer would cost $12,000 and last 6 years. It would required maintenance upkeep of $1,500 per year. The salvage value at the end of year 6 would be $1,000. Assuming a discount rate of 10%, should you keep or replace the machine?
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