A potato farmer needs to buy a new harvester. Two types have performed satisfactorily in field trials. The SpudFinder costs $140,000 and should last for five years. The simpler TaterTaker costs only $80,000 but requires an extra operator at $20,000 per season. This machine has a service life of seven years. The disposal value of either machine is insignificant. If the farmer requires a 13% return on investment, which harvester should she buy?

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The Answer of A potato farmer needs to buy a new harvester. Two types have performed satisfactorily in field trials. The SpudFinder costs $140,000 and should last for five years. The simpler TaterTaker costs only $80,000 but requires an extra operator at $20,000 per season. This machine has a service life of seven years. The disposal value of either machine is insignificant. If the farmer requires a 13% return on investment, which harvester should she buy?

A Potato Farmer Needs to Buy a New Harvester