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

question 2

Multiple Choice

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

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Definitions:

Overprotective

A behavioral trait where an individual exhibits excessive concern and control over another's life, often limiting their experience of risk and independence.

Toddlers

Young children typically aged between one and three years who are learning to walk and developing rapidly in other areas.

Erikson

Refers to Erik Erikson, a developmental psychologist known for his theory on the psychosocial development of humans, which outlines eight stages from infancy to adulthood.

Developmental Task

A skill or growth milestone that individuals are expected to achieve during specific stages in their life.