Should New Tech's computer system be replaced this year? The system has a salvage value now of $5000, which will fall to $4000 by the end of the year. The cost of lower productivity linked to the older computer is $3000 this year. New Tech uses an interest rate of 15%. What is the cost advantage of the best system? A potential new system costs $12,000 and has the following salvage values and lost productivity for each year:
