A B -90,000-750,000 Below are the cash flows for alternates A and B at an interest rate of 10% per year. Alternative First cost, $ AOC, $/year -50,000-10,000 Salvage value, $ 8,000 2,000,000 Life, years 5 The capitalized cost of alternative B is nearest

A B -90,000-750,000 Below are the cash flows for alternates A and B at an interest rate of 10% per year. Alternative First cost, $ AOC, $/year -50,000-10,000 Salvage value, $ 8,000 2,000,000 Life, years 5 The capitalized cost of alternative B is nearest

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter17: Long-term Investment Analysis

Section: Chapter Questions

Problem 6E

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Question

Multiple Choice

$−590,000.

$−625,000.

$−850,000.

$−734,000

A
B
-90,000-750,000
Below are the cash flows for alternates A and B at an interest rate of 10% per year.
Alternative
First cost, $
AOC, $/year
-50,000-10,000
Salvage value, $
8,000 2,000,000
Life, years
5
The capitalized cost of alternative B is nearest

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