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Your company is comparing two machinery investments: A and B. Your company's real Minimum Attractive Rate of Return (MARR) is 5%. Average annual inflation rate

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Your company is comparing two machinery investments: A and B. Your company's real Minimum Attractive Rate of Return (MARR) is 5%. Average annual inflation rate is 1%. The properties of these investments are provided in the following table (all dollar values are in constant dollars): IB Initial Cost $125,000 Annual Maintenance cost $90,000 $5,500/year 4,500 units/year $15/unit Annual Sales $21,000/year 4,500 units/year $10/unit Production unit cost $40/unit Product unit sale price Salvage value after 5 years $40/unit $80,000 $65,000 CCA Rate 35% 35% Service life 3 years 3 years For both alternatives, answer the following questions considering applicable taxes whenever possible: a) Provide the before-tax cash flow diagrams for both alternatives in current dollars. b] Calculate the NPW of both alternatives taking into account all taxes at a tax rate of 40% (ie, for after-tax cash flow). Half-year rule applies c) Which alternative is economically better

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