Join 60,000+ competitive exam aspirants
Two pieces of equipment are being considered. Machine A costs Rs. 1,000 and has a useful life of 8 years. At the end of 8 years it can be salvaged for Rs. 175. Machine B costs Rs. 2,000 and also has a useful life of 8 years and can be salvaged for Rs. 500 at the end of its life. If the interest rate is 8% and Machine A has a net annual benefit of Rs. 225, what must the net annual benefit of Machine B be for the two machines to be equally desirable?
Rs. 368
Rs. 406
Rs. 582
Rs. 1,000