6. National Homebuilders, Inc., plans to purchase new cut-and-finish equipment.
Two manufacturers offered the estimates below.
Vendor A Vendor B
Cost $ 15,000 $ 18,000
Annual O\&M Cost $ 3,500 $ 3,100
Salvage Value $ 1,000 $ 2,000
Life 6 years 9 years
Determine which vendor should be selected on the basis of a present worth
comparison, if the MARR is 15% per year. (20 Points)