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Reviewing your company’s new manufacturing process you decided to improve safety of equipment. You consider 3 choices of purchasing a new machine: Machine A at cost of $94,000 Machine B at cost of $70,000 plus 1,200 more per year in maintenance Machine C at cost of $64,000 plus 1,500 more per year in maintenance If machine A, B, and C are expected to last 20 years and have the same productivity, how much should you add to the purchasing cost of machine B and C to make fair price comparison and what would your choice be? Assume an interest rate of 6.08%.

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M92516323

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