Homework Answers
a) Machine X
C= 120000
benefit for first 10 year =20000/per year
benefit for next 10 years = 9000/ per year
life = 20 Years
Salvage Value = 40000
Machine Y
C = 96000
benefit =12000/per year
life = 20 Years
Salvage Value = 20000
b) 
c) Capital Recovery for
machine X is 30158.1
machine Y is 9135.6
d)I will advice to buy Machine X with NPV of 30158.1
The Pv is calculated using formula (1/(1+interest rate)^t)
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