Tim Smunt has been asked to evaluate two machines. After some investigation, he determines that they have the costs shown in the following table.
Machine A Machine B
Original Cost $12,000 $28,000
Labor per Year $2,200 $4,800
Maintenance per yr $ 4,300 $800
Salvage Value $ 2,400 $7,000
He is told to assume that:
1. The life of each machine is 3 years.
2. The company thinks it knows how to make 12% on investments no more risky than this one.
3. Labor and maintenance are paid at the end of the year.
The NPV for Machine B=$