Question

Instead of going with the old technology that costs $100,000 to buy with a salvage value...

Instead of going with the old technology that costs $100,000 to buy with a salvage value of $10,000 after 10 years, and an annual operating and maintenance cost of $10,000, the company is considering a new tech. The new tech will cost $80,000. It has no operating and maintenance cost during its life of 10 years. What should be the minimum salvage value that will support the purchase of the new tech? Use 15% interest. (Work out by hand)

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