(LG 5.3) Fantastic Footwear can invest in one of two different automated clicker cutters. The first, A, has a $100 000 first cost. A similar one with many extra features, B has a $400 000 first cost. A will save $50 000 per year over the cutter currently in use. B will save $150 000 per year. Each clicker cutter will last five years. If the MARR is 10 percent, which alternative is better? Use an IRR comparison.
(LG 5.3) Fantastic Footwear can invest in one of two different automated clicker cutters. The first, A, has a $100 000 first cost. A similar one with many extra features, B has a $400 000 first cost. A will save $50 000 per year over the cutter currently in use. B will save $150 000 per year. Each clicker cutter will last five years. If the MARR is 10 percent, which alternative is better? Use an IRR comparison.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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the answer to this question is Q5.15= DONT KNOW but we just need to find how we get that answer for these questions, please help NO EXCEL

Transcribed Image Text:5.15 (LG 5.3) Fantastic Footwear can invest in one of two different automated clicker
cutters. The first, A, has a $100 000 first cost. A similar one with many extra
features, B has a $400 000 first cost. A will save $50 000 per year over the cutter
currently in use. B will save $150 000 per year. Each clicker cutter will last five
years. If the MARR is 10 percent, which alternative is better? Use an IRR
comparison.
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