Compute annual operating cost

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A machine was bought three years ago for $200,000 with the expected life of 3 years and a salvage value of $20,000. It now can he sold for $100,000. The annual operating cost for this machine over the next ?ve years will be $30,000. A new machine can be purchased for $250,000, a salvage value of $20,000, expected life-of 10 years, and an annual operating cost of $20,000. Should we replace the old machine? MARR= 10%

Reference no: EM133124374

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