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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 $
You are considering the purchase of one of two machines used in your manufacturing plant. Machine A has a life of two years, costs $ initially, and then $ per year in maintenance costs. Machine B costs $ initially, has a life of three years, and requires $ in annual maintenance costs. Either machine must be replaced at the end of its life with an equivalent machine. Using EAC which is the better machine for the firm? The discount rate is percent and tax can be ignored.
Group of answer choices
a Machine A
b Machine B
c All of these choices are correct.
d either machine A nor B
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