You Can Continue to Use Your Less Efficient Machine at a Cost

question 69

Multiple Choice

You can continue to use your less efficient machine at a cost of $8,000 annually for the next five years.Alternatively, you can purchase a more efficient machine for $12,000 plus $5,000 annual maintenance.At a cost of capital of 15 percent, you should:

• A)Buy the new machine and save $600 in equivalent annual costs
• B)Buy the new machine and save $388 in equivalent annual costs
• C)Keep the old machine and save $388 in equivalent annual costs
• D)Keep the old machine and save $580 in equivalent annual costs $12,000 + $5,000

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Definitions:

Consumption

The use of goods and services by households or individuals, viewed as an economic activity and a component of economic systems.

Michel Foucault

A French philosopher and social theorist known for his influential work on power dynamics, social institutions, and the relationship between knowledge and control.

Sciences of Sex

This term refers to interdisciplinary research areas that study sexual behavior, biological differences between sexes, and the impact of sex on various aspects of life, including health, society, and psychology.

Nineteenth Century

A century marked by industrialization, political revolutions, and the expansion of the British Empire, spanning from 1801 to 1900.