Why the answer is not B? I calculate that PV=9607.33.Homework Answers
Answer - $14410.99
In current situation the company has a present value of expense of $24018.32 ( present value) and after replacement the company will be incurring only $9607.33 ( present value) so comapco should spend maximum 24018.32 - 9607.33 = 14410.99 to replace the new machine. Any amount above that would make the company incur more than what the company is incurring currently.
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Why the answer is not B? I calculate that PV=9607.33.
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