What would be the annual profit associated with each option


The cost of a$50,000 tool will be recovered over a ten years period using one of 2 methods. The 1st would involved determining the annual recovery amount based on the interest rate of 4% while the second method would merely involve recovering a tenth of the cost each year. If the money made each year using this machine is $8000 what would be the annual profit associated with each option and what would be the difference in a present worth analysis for cash opinion.

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Financial Management: What would be the annual profit associated with each option
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