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You are evaluating two different silicon wafer milling machines. The Techron I costs $277,500, has a three-year life, and has pretax operating costs of $45,500
You are evaluating two different silicon wafer milling machines. The Techron I costs $277,500, has a three-year life, and has pretax operating costs of $45,500 per year. The Techron II costs $382,500, has a five-year life, and has pretax operating costs of $48,500 per year. For both milling machines, use straight-line depreciation to zero over the projects life and assume a salvage value of $22,500. Assume the tax rate is 35 percent and the discount rate is 10 percent.
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