↑Consider these two alternativesCapital InvestmentAnnual revenuesAnnual expensesEstimated market valueUseful lifeAlternative 1.$4,100$1,450$400$900Alternative 2$6,100$1,800$490$1,2506 years9 yearsa Suppose that the capital investment of Alternative 1 is known with certainty. By how much would the estimate of capital investment for Alternative 2 have to vary so that the initial decisionbased on these data would be reversed? The annual MARR is 15% per year.b. Determine the life of Alternative 1 for which the AWs are equalClick the icon to view the interest and annuity table for discrete compounding when the MARR is 15% per year.GEa. The capital investment of Altemalive 2 would have to be $ 6274 or less for the initial decision to be reversed. (Round to the nearest dollar)b. The life of Alternative 1 for which the AWs are equal isyears. (Round to one decimal place) More InfoN23456789101112131415Single PaymentCompoundAmountPresentFactor Worth FactorTo Find FGiven PFIP1.15001.32251.52091.74902.0114Discrate Compounding; /= 15%2.31312.66003.05903.51794.04564.65245.35036.15287.07578.1371To Find PGiven FPIF0.86960.75610.65750.57180.49720.43230.37590.32690.28430.24720.21490.18690.16250.14130.1229CompoundAmountFactorTo Find FGiven AFIA1.00002.15003.47254.99346.74248.753711.066813.726816.785820.303724.349329.001734.351940.504747.5804Uniform SeriesPresentWorth FactorTo Find PGiven APIA0.86961.62572.28322.85503.35223.78454.16044.48734.77165.01885.23375.42065.58315.72455.8474SinkingFundFactorTo Find AGiven FAIF1.00000.46510.28800.20030.14830.11420.09040.07290.05960.04930.04110.03450.02910.02470.0210CapitalRecoveryFactorTo Find AGiven PAIP1.15000.61510.43800.35030.29830.26420.24040.22290.20960.19930.19110.18450.17910.17470.1710

The annual worth represents the average annual income or benefit that can be obtained from an…

$900 $1,250 Estimated market value Useful life 6 years 9 years a Suppose that the capital investment of Atemative 1 is known with certainty. By how much would the estimate of capital investment for Alternative 2 have to vary so that the initial decision based on these data would be reversed? The annual MARR is 15% per year. b. Determine the life of Alternative 1 for which the AWWs are equal

$900 $1,250 Estimated market value Useful life 6 years 9 years a Suppose that the capital investment of Atemative 1 is known with certainty. By how much would the estimate of capital investment for Alternative 2 have to vary so that the initial decision based on these data would be reversed? The annual MARR is 15% per year. b. Determine the life of Alternative 1 for which the AWWs are equal

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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