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You are evaluating two different silicon wafer mling machines. The Techron I costs $300,000, has a three- year life, and has pretax operating costs of

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You are evaluating two different silicon wafer mling machines. The Techron I costs $300,000, has a three- year life, and has pretax operating costs of S65,000 per year. The Tecbron II costs S500,000, has a five-year life, and has pretax operating costs of $37,000 per year. For both milling machines, use straight-line depreciation to zero over the project's life and assume a salvage value of $40,000. If your tax rate is 35% and discount rate is 12 percent, compute the EAC for both machines. Which do you prefer? Why

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