Heritage Airways is considering a new route to Dubai or London. Based on the cash flow information presented below, a MARR of 10%, and a study period of 10 years, using ROR analysis, which route should Heritage Airlines select? Dubai Route First cost AOC AOR Salvage value Life, years London Route $300,000,000 $500,000,000 $50,000,000 $80,000,000 $100,000,000 $180,000,000 $30,000,000 $50,000,000 10 10 Dubai Route with PW = $134,215,000 Dubai Route with PW = $18,800,000 Do Nothing London Route with PW = $114,940,000

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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Please provide the correct answer along with the calculation. Do not use ChatGPT, otherwise I will give a downvote.
Heritage Airways is considering a new route to Dubai or London. Based on the cash flow
information presented below, a MARR of 10%, and a study period of 10 years, using ROR
analysis, which route should Heritage Airlines select?
Dubai Route
First cost
AOC
AOR
Salvage value
Life, years
London Route
$300,000,000
$500,000,000
$50,000,000
$80,000,000
$100,000,000
$180,000,000
$30,000,000
$50,000,000
10
10
Dubai Route with PW = $134,215,000
Dubai Route with PW = $18,800,000
Do Nothing
London Route with PW = $114,940,000
Transcribed Image Text:Heritage Airways is considering a new route to Dubai or London. Based on the cash flow information presented below, a MARR of 10%, and a study period of 10 years, using ROR analysis, which route should Heritage Airlines select? Dubai Route First cost AOC AOR Salvage value Life, years London Route $300,000,000 $500,000,000 $50,000,000 $80,000,000 $100,000,000 $180,000,000 $30,000,000 $50,000,000 10 10 Dubai Route with PW = $134,215,000 Dubai Route with PW = $18,800,000 Do Nothing London Route with PW = $114,940,000
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