Machine X Machine Y First Cost, S 20,000 14,000 Year 1 AOC, S Year 2 AOC, S 5,000 Year 3 AOC, $ 3,000 5,000 Year 4 AOC, S 4,000 5,000 Year 5 AOC, S 4,000 6,000 Year 6 AOC, S 5,000 Year 7 AOC, $ 4,000 Salvage Value in 3,000 Year 8, S X for a project that will last 8 years. 2 3 4 3000 4000 4000 3000 5000 5000 와 20000 14000 S 6000 7 5000 R 00

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
Section: Chapter Questions
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Use annual worth analysis to decide on which machine to buy for a project that will last 8 years.
Machine X Machine Y
2 3
S
0
4
X
First Cost, $
20,000
14,000
Year 1 AOC, $
Year 2 AOC, S
5,000
20000
4000 4000
Year 3 AOC, $
3,000
5,000
Year 4 AOC, S
4,000
5,000
Year 5 AOC, $
4,000
6,000
Year 6 AOC, S
5,000
Year 7 AOC, S
4,000
Salvage Value in 3,000
Year 8, S
14000
3000
3000
5000
Sood
6000
5000
7
3000
4000
2⁰0
Transcribed Image Text:Use annual worth analysis to decide on which machine to buy for a project that will last 8 years. Machine X Machine Y 2 3 S 0 4 X First Cost, $ 20,000 14,000 Year 1 AOC, $ Year 2 AOC, S 5,000 20000 4000 4000 Year 3 AOC, $ 3,000 5,000 Year 4 AOC, S 4,000 5,000 Year 5 AOC, $ 4,000 6,000 Year 6 AOC, S 5,000 Year 7 AOC, S 4,000 Salvage Value in 3,000 Year 8, S 14000 3000 3000 5000 Sood 6000 5000 7 3000 4000 2⁰0
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