For the anticipated annual use of the drafting services, which alternative would you recommend? Remember to show your calculations in your supporting work. O Handy-Cam O R-tistry

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
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Two alternative means of providing engineering drafting services are under consideration.
Handy-Cam
$250,000
$115/hr
$250/hr
$15,000
R-tistry
$200,000
$120/hr
$250/hr
$20,000
Purchase Price
Operating Cost
Revenue
Market value (end of useful life)
Useful life
б years
б years
It is anticipated that the chosen alternative will be used to generate revenue 8 hrs/day, 250 days per year. The company uses a MARR = 12% for all
investments.
Transcribed Image Text:Two alternative means of providing engineering drafting services are under consideration. Handy-Cam $250,000 $115/hr $250/hr $15,000 R-tistry $200,000 $120/hr $250/hr $20,000 Purchase Price Operating Cost Revenue Market value (end of useful life) Useful life б years б years It is anticipated that the chosen alternative will be used to generate revenue 8 hrs/day, 250 days per year. The company uses a MARR = 12% for all investments.
For the anticipated annual use of the drafting services, which alternative would you recommend? Remember to show your calculations in your supporting
work.
O Handy-Cam
O R-tistry
Transcribed Image Text:For the anticipated annual use of the drafting services, which alternative would you recommend? Remember to show your calculations in your supporting work. O Handy-Cam O R-tistry
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