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A manufacturing firm is considering two models of lathes. Model A will have an initial cost of $29,000, an operating cost of $2750, and a salvage value of $6500 after 6 years. Model B will have an initial cost of $32,780, an operating cost of $2200, and a $7750 resale value after 12 years. At an interest rate of 10% per year, compute the AW for Model B
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Firms in Japan habitually employ high operating and financial leverage because of the use of modern technology and close borrower-lender relationships
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