You are selecting equipment for a project. There are two machines under consideration. They will provide the same function, but there are difference in cost, benefits, life and other details. Costs, machine prices AND salvage all go up at the rate of inflation. Costs and benefits are shown for year 1. Benefits go up by the % given. Salvage costs are given for a 10 yr old machne A and a 5 yr old machine B TODAY. Adjust with inflation. Help your employer to determine which machine is the best choice.

MARR	15.00%
Inflation	3.200%
Machine A				Machine B
Initial Cost	$9,750			Initial Cost	$ 6,220
Salvage	$ 3,950	10 yr old machine today		Salvage	$ 1,250	5 yr old machine today
Life	10	Years		Life	5	Years
Benefits	$ 5,053	Per year		Benefits	$ 5,100	Per year
Benefit inc	4.20%			Benefits inc	3.95%
Costs	$ 2,090	Per year		Costs	$ 2,250	Per year

Create the net cash flow chart for both machines.

Deterine the NPW for both machines.

Determine the EUAW for both machines.

Determine the NFW for both machines.

Determine the IRR for both machines

Detemine the DELTA IRR .

Which machine will you select? Why?

Graph the NPW versus MARR chart for both machines (both curves on the same graph)

******Please show excel formula or included the excel spread sheet****