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Problem:

Tool Makers, Inc. uses tool and die machines to produce equipment for other firms. The initial cost of one customized tool and die machine is $850,000. This machine costs $10,000 a year to operate. Each machine has a life of 3 years before it is replaced.
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Question: What is the equivalent annual cost of this machine if the required return is 8%?

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91147479

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