The expected annual maintenance expense for a new piece of equipment is $10, 000. This is Alternative A. Alternatively, it is possible to perform the maintenance every fifth year at a cost of $50, 000 (Alternative B). In either case, maintenance will be performed in the fifth year so that the equipment can be sold for $100, 000 at that time. If the MARR is 15% per year (before income taxes), which alternative should be recommended in each of these situations? (7.10)
a. Before income taxes are considered
b. After income taxes are considered when t = 40%.
c. Is there a different selection before and after income taxes are considered?