Engineering Economy 7th Edition by Leland Blank ,Anthony Tarquin

Exercise 4

The manager of a canned food processing plant must decide between two different labeling machines. Machine A will have a first cost of $42,000, an annual operating cost of $28,000, and a service life of 4 years. Machine B will cost $51,000 to buy and will have an annual operating cost of $17,000 during its 4-year life. At an interest rate of 10% per year, which should be selected on the basis of a present worth analysis