You want to buy a new machine and you are considering two different models. The first model costs 380 dollars to purchase, requires maintenance costs of 166 dollars per year and lasts for 5 years. The second model costs 580 dollars requires maintenance costs of 132 dollars per year and lasts for 8 years. The discount rate is %20.

a) What is the equivalent annual cost of the first model?

b)What is the equivalent annual cost of the second model?

c) Which one do you prefer?