A firm has two alternatives for the improvement of its current production system. The data are as follows: Мachine A Мachine B First Cost – P7,397,822 First cost – P7M Annual operating cost – P283,742 Service life – 4 years Salvage value – P171,201 Using the Annual Equivalent Cost (AEC) Method and with the firm's interest rate of 21% cpd. annually, what the AEC of Machine A? Annual operating cost – P300T Service life – 6 years Salvage value – P200T

A firm has two alternatives for the improvement of its current production system. The data are as follows: Мachine A Мachine B First Cost – P7,397,822 First cost – P7M Annual operating cost – P283,742 Service life – 4 years Salvage value – P171,201 Using the Annual Equivalent Cost (AEC) Method and with the firm's interest rate of 21% cpd. annually, what the AEC of Machine A? Annual operating cost – P300T Service life – 6 years Salvage value – P200T

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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