Suppose you may choose between two machines for production atyour store. Both machines have a useful cycle of 10 years. MachineA cost $10,000, leaves an annual (EOY) income of $2,500, machine Ahas annual expenses of $1,000, and has a salvage (ending) value of$3,000 at the end of 10 years. Machine B cost $15,000, leavesan annual (EOY) income of $2,000, machine B has no annualexpenses , and has no salvage (ending) value.
Find the present value (P) for both choices if the annual interest is 8%.