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You are considering the purchase of one of two machines used in your manufacturing plant Machine A has a life of two years, costs $115
You are considering the purchase of one of two machines used in your manufacturing plant Machine A has a life of two years, costs $115 initially, and then $160 per year in maintenance costs. Machine B costs $185 initially, has a life of three years, and requires $135 in annual maintenance costs. Either machine must be replaced at the end of its life with an equivalent machine The discount rate is 11 percent and the tax rate is zero. Calculate the EAC. (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.) Answer is complete but not entirely correct. $ Machine A Machine B EAC 227.15% 210.703 Which one should you choose? Machine A Machine B
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