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Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 Р17,000 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%

Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 Р17,000 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%

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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1.) Present Worth Cost Method
2.) Equivalent Uniform Annual Cost Method

Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 Р17,000 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%
Transcribed Image Text:Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 Р17,000 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%
Expert Solution
Step 1

Given:

Machine A: First Cost=P 12000

Machine B: First Cost=P 17000

 

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