A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firm’s production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $26,754.00 per year for 8 years and costs $98,586.00. The UGA-3000 produces incremental cash flows of $27,362.00 per year for 9 years and cost $125,653.00. The firm’s WACC is 7.38%. What is the equivalent annual annuity of the UGA-3000? Assume that there are no taxes
Can you show me how you solved even if it was done in excel. Thanks!
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