Equivalent annual cost over machine life

Reference no: EM1329961

Two machines, A and B, which perform the same functions, have the following costs and lives.

Type PV Costs Life
machine A $6000 5
machine B $8000 7

Which machine would you choose? Justify your decision. The two machines are mutually exclusive and the cost of capital is 15%.

Reference no: EM1329961

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