A mechanical engineer is considering two materials for use in an electrical vehicle. All estimates are made. Material X Material Y First cost, RM Maintenance Cost, RM per year Salvage value, RM Life, years 15,000 35,000 7,000 9,000 2,000 20,000 5 5 a) Suggest which alternative should be selected with 10% interest rate. b) Find out at what first cost the method not selected above will become the more economics preference.

A mechanical engineer is considering two materials for use in an electrical vehicle. All estimates are made. Material X Material Y First cost, RM Maintenance Cost, RM per year Salvage value, RM Life, years 15,000 35,000 7,000 9,000 2,000 20,000 5 5 a) Suggest which alternative should be selected with 10% interest rate. b) Find out at what first cost the method not selected above will become the more economics preference.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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