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A construction company has three choices of the type of machine to be used for their...

A construction company has three choices of the type of machine to be used for their project (interest rate is 7% for all options). The choices are as following:


a. Machine sold by manufacturer A- This machine has an initial cost of $750,000, Salvage value of 100,000 sold after 50 years, and the variable cost of $55 per hour and maintenance cost of $4 per hour of usage.

b. Machine sold by manufacturer B- This machine has an initial cost of $550,000, Salvage value of 50,000 sold after 50 years, and the variable cost of $75 per hour and maintenance cost of $7 per hour of usage.

c. Machine sold by manufacturer C- This machine has an initial cost of $250,000, Salvage value of 10,000 sold after 50 years, and the variable cost of $95 per hour and maintenance cost of $10 per hour of usage.

Which Manufacturer should this company choose? (Show calculations and draw graphical representation)

Engineering   Civil-Engineering   
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