IDNLearn.com offers expert insights and community wisdom to answer your queries. Get the information you need from our experts, who provide reliable and detailed answers to all your questions.

Soft Touch Car Wash is considering the purchase of a new automated sudser and has narrowed it down to 2 possible machines: One, which costs more but lasts longer, and one that is less expensive but has a shorter useful life. The expected cash flows associated with the 2 machines are as follows:

Expected cash flow of two machines
Year Machine A Machine B
0 50.000 30.000
1 20.000 20.000
2 20.000 20.000
3. 20.000 NA
4. 20.000 NA
What is the Internal Rate of Return for each machine?