Homework Answers
Future worth of T = -20000 * (F/P, 10%,10) - (12000 + 2000)*(F/A, 10%,10) + 5000
= -20000 * 2.593742 - 14000*15.937425 + 5000
= -269998.80
Future worth of M = -30000 * (F/P, 10%,10) - (6000 + 4000)*(F/A, 10%,10) + 7000
= -30000 * 2.593742 - 10000*15.937425 + 7000
= -230186.52
As the Future cost of M is less, it should be selected
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