5. If the MARR is 12% per year, compare the alternatives shown below on the basis of a present-worth method Alternative 1 Alternative 2 First cost $21000 $26000 Annual operating cost $3500 $4000 $14000 $15500 Annual income Salvage value $6000 $7000 Life, years 4 5

5. If the MARR is 12% per year, compare the alternatives shown below on the basis of a present-worth method Alternative 1 Alternative 2 First cost $21000 $26000 Annual operating cost $3500 $4000 $14000 $15500 Annual income Salvage value $6000 $7000 Life, years 4 5

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. If the MARR is 12% per year, compare the alternatives shown below on the basis
of a present-worth method
Alternative 1
Alternative 2
First cost
$21000
$26000
Annual operating cost
$3500
$4000
$14000
$15500
Annual income
Salvage value
$6000
$7000
Life, years
4
5

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