Question 2 - A drill press was purchased 2 years ago for $40,000. The press can be sold for $15,000 today,
or for $12,000, $10,000, $8000, $6000, $4000, or $2000 at the ends of each of the next 6 years. The annual
operating and maintenance cost for the next 6 years will be $2700, $2900, $3300, $3700, $4200, and
$4700.
A) Determine the marginal cost to extend service for each of the next 6 years if the MARR is 12%. (1.5
points)
B) (Bonus) If a new drill press has a minimum EUAC of $7000, when should the drill press be
replaced? Explain your answer. (1 point)