What life of this machinery has the lowest euac

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Reference no: EM131810504

The plant manager may purchase a piece of unusual machinery for $10,000. Its resale value after 1 year is estimated to be $3000. Because the device is sought by antique collectors, resale value is rising $500 per year The maintenance cost is $300 per year for each of the first 3 years, and then it is expected to double each year. Thus the fourth-year maintenance will be $600; the fifth-year maintenance, $1200, and so on. Based on a 15% before-tax MARR, what life of this machinery has the lowest EUAC?

Reference no: EM131810504

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