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Pigs-R-Us Example 2 (Alternatives with Equal Lives)

Pigs-R-Us Example 2 (Alternatives with Equal Lives) - a...

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Pigs-R-Us Example 2 (Alternatives with Equal Lives) Pigs-R-Us is evaluating two machines to automate their meat packing operation. Both have a useful life of 10 years and both will save $50,000 per year in labor costs. Machine A requires an initial investment of $200,000. It costs $9000 per year to operate and maintain and has
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Unformatted text preview: a salvage value of $10,000. Machine B requires an initial investment of $220,000. It costs $6000 per year to operate and maintain and has a salvage value of $15,000. If Pigs-R-Us has a 14% MARR, which machine if either would you recommend?...
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