Suppose a machine generates $500 worth of revenue at the end of each of the next three years, at which time it can be sold to a salvage company for $350. If the annual rate of interest is 0.08, what is the maximum amount a business would pay for this machine if maintenance costs are $100 per year?
A. $1506
B. $1309
C. $1096
D. $9567
Answer: B
Economics
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