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QUESTION
You are evaluating two different cookie-baking ovens. The Pillsbury 707 costs $68,000, has a 5-year life, and has an annual OCF (after tax) of...
You are evaluating two different cookie-baking ovens. The Pillsbury 707 costs $68,000, has a 5-year life, and has an annual OCF (after tax) of -$11,000 per year. The Keebler CookieMunster costs $95,000, has a 7-year life, and has an annual OCF (after tax) of -$9,000 per year.
If your discount rate is 11 percent, what is each machine's EAC?
