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Xenon Document services needs to buy printers for their new store
Xenon Document services needs to buy printers for their new store. They are choosing between two printer models. HP DeskJet model cost $340 to purchase, result in electricity bills of $158 per year, and last for 5 years. Epson Inkjet model cost $540, result in electricity bills of $116 per year, and last for 8 years. The discount rate is 23%.
a. what is me equivalent annual cost of the HP DeskJet model? (Do not round intermediate calculations.
Round your answers to 2 decimal places.)
HP DeskJet
Equivalent annual cost
?
b. Which model is more cost-effective?
HP DeskJet model
Epson Inkjet
Expert Solution
a). Equivalent annual cost (EAC) for HP Deskjet model = $279.28
EAC for Epson Inkjet model = $269.50
b). Epson Inkjet model is more effective because it has lower EAC than the HP Deskjet model.
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