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You are considering the purchase of one of two machines used in your manufacturing plant. Machine A has a life of two years, costs $105 initially, and then $150 per year in maintenance costs. Machine B costs $175 initially, has a life of three years, and requires $125 in annual maintenance costs. Either machine must be replaced at the end of its life with an equivalent machine. The discount rate is 13 percent and the tax rate is zero. Calculate the EAC. (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.)

EAC Machine A$

Machine B $

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92424482

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