Multiple Choice
You are evaluating two different machines. Machine A costs $10,000, has a five-year life, and has an annual OCF (after tax) of -$2,500 per year. Machine B costs $15,000, has a seven-year life, and has an annual OCF (after tax) of -$2,000 per year. If your discount rate is 14 percent, using EAC which machine would you choose?
A) Machine A
B) Machine B
C) Both Machines A and B
D) Neither Machine A nor B
Correct Answer:
Verified
Correct Answer:
Verified
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