Choose from the two machines which is more economical:Machine AMachine BFirst CostP12,000P17,000Salvage ValueAnnual OperationP2,0003,0002,400Annual Maintenance1,2001,000Taxes and Insurance3%3%Life, years1015Money is worth at least 16%A) Rate of Return on Additional Investment MethodB) Annual Cost MethodC) Present WWorth Cost MethodD) Equivalent Uniform Annual Cost Method

Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 P17,000 Salvage Value Annual Operation P2,000 3,000 1,200 2,400 1,000 Annual Maintenance Taxes and Insurance 3% 3% Life, years 10 15 Money is worth at least 16% A) Rate of Return on Additional Investment Method B) Annual Cost Method C) Present Worth Cost Method D) Equivalent Uniform Annual Cost Method

Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 P17,000 Salvage Value Annual Operation P2,000 3,000 1,200 2,400 1,000 Annual Maintenance Taxes and Insurance 3% 3% Life, years 10 15 Money is worth at least 16% A) Rate of Return on Additional Investment Method B) Annual Cost Method C) Present Worth Cost Method D) Equivalent Uniform Annual Cost Method

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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