Choose from the two machines which is more economical: Machine B 14000 P2,000 2,400 Machine A First Cost P12,000 Salvage Value Annual Operation 3,000 Annual Maintenance 1,200 1,000 3% Taxes and Insurance 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 B 14000 P2,000 2,400 Machine A First Cost P12,000 Salvage Value Annual Operation 3,000 Annual Maintenance 1,200 1,000 3% Taxes and Insurance 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
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Calculate only for LETTER C.
No Excel, please.
Solve MANUALLY. Thank you.
![Choose from the two machines which is more economical:
Machine A
Machine B
First Cost
P12,000
14000
Salvage Value
Annual Operation
P2,000
3,000
2,400
Annual Maintenance
1,200
1,000
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](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3f856bcd-4ebc-4534-af23-42aa9ca08e79%2F824d7dc7-02fc-4b6a-bc4f-84bee86dc33a%2F85qp1m4_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Choose from the two machines which is more economical:
Machine A
Machine B
First Cost
P12,000
14000
Salvage Value
Annual Operation
P2,000
3,000
2,400
Annual Maintenance
1,200
1,000
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
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