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Equivalent annual annuity of the gsu-3300

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A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firm's production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $26,471.00 per year for 8 years and costs $103,774.00. The UGA-3000 produces incremental cash flows of $29,865.00 per year for 9 years and cost $126,092.00. The firm's WACC is 7.10%. What is the equivalent annual annuity of the GSU-3300? Assume that there are no taxes.

Reference no: EM132509544

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