A \$25,000 machine that has been used for one year has a salvage value of $16,000 now, which will drop by $4,000 per year. The maintenance costs for the remaining 4 years of the asset are $1,250,$2,500,$5,500 and $6,750. When the machine is sold, it will cost $2,000 to remove and sell. When machine was purchased, the estimated salvage in 5 years was $3,500. Assume an interest rate of 8\%. a) What is the marginal cost for each year? b) If a challenger has a minimum EUAC of $11,000 when should the current machine be replaced?