Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 P17,000 Salvage Value Annual Operation P2,000 3,000 2,400 Annual Maintenance 1,200 1,000 Taxes and Insurance 3% 3% Life, years 10 15

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Choose from the two machines which is more economical:
Machine A
Machine B
First Cost
P12,000
P17,000
Salvage Value
Annual Operation
P2,000
2,400
1,000
3,000
Annual Maintenance
1,200
Taxes and Insurance
3%
3%
Life, years
10
15
Transcribed Image Text:Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 P17,000 Salvage Value Annual Operation P2,000 2,400 1,000 3,000 Annual Maintenance 1,200 Taxes and Insurance 3% 3% Life, years 10 15
Money is worth at least 16%
Rate of Return on Additional Investment Method
Annual Cost Method
Present Worth Cost Method
Equivalent Uniform Annual Cost Method
Transcribed Image Text:Money is worth at least 16% Rate of Return on Additional Investment Method Annual Cost Method Present Worth Cost Method Equivalent Uniform Annual Cost Method
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