A small manufacturing company needs to purchase a machine that will have a first cost of $70,000….

A small manufacturing company needs to purchase a machine that will have a first cost of $70,000. The company wants to buy an option that will allow it to purchase the machine for the same price of $70,000 for up to 1 year from now. If the company s MARR is 10% per year, the maximum amount the company should pay for the option is closest to: (a) $5850 (b) $6365 (c) $6845 (d) $7295