Manufacturing installed an automated conveyor system

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Eight years ago, Jaguar Manufacturing installed an automated conveyor system for $38 000. In any year, removal of the current automated conveyor system requires an investment of $2, 500. The operations and maintenance costs for the next year is $5k increasing at 15% per year for four more years. The minimum EUAC of a new automated conveyor system is $5, 500. When (if at all) should Jaguar replace the conveyor if the before-tax MARR is 12%?

Reference no: EM131338632

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