Automated Manufacturers Uses High-Tech Equipment to Produce Specialized Aluminum Products

Multiple Choice

Automated Manufacturers uses high-tech equipment to produce specialized aluminum products for its customers.Each one of these machines costs $1,480,000 to purchase plus an additional $52,000 a year to operate.The machines have a 6-year life after which they are worthless.What is the equivalent annual cost of one these machines if the required return is 16 percent?

A) -$453,657
B) -$427,109
C) -$301,586
D) -$295,667
E) -$256,947