8. Your cat's summer kitty-cottage needs a new roof. You feel a 15-year analysis period is in line with your cat's remaining lives. You are considering the following roof alternatives: Thatch Slate First Cost $250 $425 Annual upkeep cost 65 30 Useful life, yr 3 5. a) Graph the EUAC or EUAW for the alternatives. Construct a choice table from interest rates 0-100%. b) Which roof should you choose if your MARR is 12%? What is the actual value of the IRR on the incremental cost?
8. Your cat's summer kitty-cottage needs a new roof. You feel a 15-year analysis period is in line with your cat's remaining lives. You are considering the following roof alternatives: Thatch Slate First Cost $250 $425 Annual upkeep cost 65 30 Useful life, yr 3 5. a) Graph the EUAC or EUAW for the alternatives. Construct a choice table from interest rates 0-100%. b) Which roof should you choose if your MARR is 12%? What is the actual value of the IRR on the incremental cost?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:8.
Your cat's summer kitty-cottage needs a new roof. You feel a 15-year analysis
period is in line with your cat's remaining lives. You are considering the following roof
alternatives:
Thatch
Slate
First Cost
$250
$425
Annual upkeep cost
Useful life, yr
65
30
3.
a) Graph the EUAC or EUAW for the alternatives. Construct a choice table from interest rates
0-100%.
b) Which roof should you choose if your MARR is 12%? What is the actual value of the IRR on
the incremental cost?
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