Using an annualized equivalent cost analysis

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Machine A costs $20,000, lasts 3 years and has a salvage value S of $3,000. Machine B costs $12,000, lasts 2 years and has a salvage value of $2,000. The machines can be purchased at the same price with the same salvage value in the future, and are needed for a 6 year project. Which Machine would you purchase and why? Provide justification using an Annualized Equivalent Cost analysis.

Reference no: EM13853448

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