If the average interest rate is 12% and depreciation is to be accounted for by straight line method at 10%, which of the following equipment will be most economical?

• A. Initial cost Rs. 4000 Annual disbursements Rs. 6000
• B. Initial cost Rs. 5500 Annual disbursements Rs. 4000
• C. Initial cost Rs. 6000 Annual disbursements Rs. 3880
• D. Initial cost Rs. 5000 Annual disbursements Rs. 3500
• E. Initial cost Rs. 7000 Annual disbursements Rs. 2500