Assuming interest rates hold steady

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Awesome-Moped Corporation wants to buy a new moped-making machine that will save them money in production costs. They have two options: one machine will save them approximately $5,000 per year and has an expected lifespan of 12 years. Another machine will save them approximately $7,000 per year, but has an expected life span of only 8 years. The first machine costs $33,000, and the second machine costs $37,000. Assuming interest rates hold steady at 5%, which should they buy?

Reference no: EM131188475

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