Problem 7: Two pumps are being considered for pumping water from a reservoir. Installed cost and salvage value for the two pumps are given below. Pump A Pump B Installed Cost $20,000 $25,000 Salvage Value $2,000 $4,000 Pump A has a service life of 4 years. Determine the service life of pump B at which the two pumps are competitive if the annual effective interest rate is 15%. To be competitive, pump B must have the same capitalized cost as pump A.