The Perez Company has the opportunity to invest in one of two mutually exclusi

The Perez Company has the opportunity to invest in one of two mutually exclusive machines that will produce a product it will need for the foreseeable future.
Machine A costs $8 million but realizes after-tax inflows of $4.5 million per year for 4 years. After 4 years the machine must be replaced. Machine B costs
$17 million and realizes after-tax inflows of $4.5 million per year for 8 years after which it must be replaced. Assume that machine prices are not expected
to rise because inflation will be offset by cheaper components used in the machines. The cost of capital is 13%.

A)By how much would the value of the company increase if it accepted the better machine? Enter your answer in millions. For example an answer of $1.2 million
should be entered as 1.2 not 1200000. Round your answer to two decimal places.

B)What is the equivalent annual annuity for each machine? Enter your answer in millions. For example an answer of $1.2 million should be entered as 1.2 not
1200000. Round your answers to two decimal places.