PLease Help 6. Consider below the Marginal Cost of an existing machine and theEquivalent Uniform Annual Cost Data of buying an new machine.The company's Minimum Attractive Rate of Return is 15%. Theexisting machine still in use was purchased for $15,000 four yearsago.Table 6.0 - Marginal cost of an operational widget making machineCost ofYear, nLoss in MarketForgoneValue in Year nInterest inYear n$15,000(0.15)= $2,250123456$15,000 - $8,000 =$7,000$8,000 - $4,000 =$4,000$4,000 - $3,000 =$1,000$3,000-$2,000 =$1,000Cost ($)$2,000 - $1,000 =$1,000$1,000 - $500 =$5000$8,000(0.15) = $1,100$1,200$1,200$4,000(0.15)= $600=$1,300$1,500$1,000(0.15) $1,700= $150$3,000(0.15)= $300$2,000(0.15)= $300O&MCost inYear n$1,000Figure 6.0 - EUAC cost against time, for a new widget making machine11,00010,0009,0008,0007,0006,0005,0004.0003,0002,0001,00067BreakdownRisk in Year n$0$500$1,000$2,000$3,000$4,000Year8 91011Total MarginalCost in Year n$10,250$6,800$3,800$4,600$5,800$6,350Total EUACEUAC of Maintenanceand RepairEUAC of OperatingEUAC of Capital Recovery12 131415Should the existing machine continue to be used or replaced? Whyor why not? If it is to be replaced, in what year should it bereplaced?

Replacement analysis is used to determine the replacement time for an old machine. For the…

6. Consider below the Marginal Cost of an existing machine and the Equivalent Uniform Annual Cost Data of buying an new machine. The company's Minimum Attractive Rate of Return is 15%. The existing machine still in use was purchased for $15,000 four years ago. Tablo 60- Marginal cost of an operational widget making machine

6. Consider below the Marginal Cost of an existing machine and the Equivalent Uniform Annual Cost Data of buying an new machine. The company's Minimum Attractive Rate of Return is 15%. The existing machine still in use was purchased for $15,000 four years ago. Tablo 60- Marginal cost of an operational widget making machine

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter7: Proudction Costs

Section: Chapter Questions

Problem 8SQP

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