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Your small business is considering purchasing one of two different computers. Computer A costs $820 today and will increase after-tax revenues by $91, $254, and
Your small business is considering purchasing one of two different computers. Computer A costs $820 today and will increase after-tax revenues by $91, $254, and $734 over years 1-3 respectively. Computer B costs $690 today and will increase after-tax revenues by $451, $246, and $89 over years 1-3 respectively. If your firms financing rate is 12%, what is the cross over rate between these two computers and which should you choose?
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