A $40,000 machine will be purchased by a company whose interest rate is 12%. The installation cost is $5K, and the removal costs are insignificant. What is its economic life if its salvage values and O&M costs are as follows:
Year 1 2 3 4 5
S $35K $30K $25K $20K $15K
O&M $8K $14K $20K $26K $32K