5- The manager in a factory is trying to decide between two machines: A 15,000 1,600 Cost Operation and Maintenance Uniform annual benefit 8,000 Salvage 3,000 Useful life 6 B 25,000 400 13,000 6,000 10 years For an interest rate of 6%, use annual cash flow analysis to determine which machine should be chosen. Answer: Machine B

5- The manager in a factory is trying to decide between two machines: A 15,000 1,600 Cost Operation and Maintenance Uniform annual benefit 8,000 Salvage 3,000 Useful life 6 B 25,000 400 13,000 6,000 10 years For an interest rate of 6%, use annual cash flow analysis to determine which machine should be chosen. Answer: Machine B

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

5- The manager in a factory is trying to decide between two machines:
A
15,000
1,600
Cost
Operation and
Maintenance
Uniform annual benefit 8,000
Salvage
3,000
Useful life
6
B
25,000
400
13,000
6,000
10 years
For an interest rate of 6%, use annual cash flow analysis to determine which machine should be chosen.
Answer: Machine B

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