You are considering two different silicon wafer milling machines. The Techron I costs $210,000, has a 3 year life and pre-tax operating costs of $34,000 per year. The Techron II costs $320,000, has a five-year life and pre-tax operating costs of $23,000 per year. Both machines are in Class 9 (20% CCA rate). Assume a salvage value of $20,000. The firm's tax rate is 35% and its cost of capital is 14%. Which machine is preferable if the machines are replaced when they wear out? Which is preferred if the machines are not replaced?

What is the NPV for Techrnon i?

What is the NPV for Techron ii?

What is the Yearly NPV for Techrnon i?

What is the Yearly NPV for Techron ii?

If the machine were not replaced they would choose

With replacement, you would choose