Compute the EAC for both machines

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Question - You are evaluating two different silicon wafer milling machines. The Techron I costs $276,000, has a three-year life, and has pretax operating costs of $75,000 per year. The Techron II costs $480,000, has a five-year life, and has pretax operating costs of $48,000 per year. For both milling machines, use straight-line depreciation to zero over the project's life and assume a salvage value of $52,000. If your tax rate is 21 percent and your discount rate is 12 percent, compute the EAC for both machines.

Reference no: EM132848603

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