Motor A Initial Investment 1,250,000 1,300,000 Horse Power 100Hp 100Hp Efficiency 74% 92% Useful Life 10 years 10 years MARR 15% 15% Maintenance Cost/year 50,000 25,000 Electrical cost 5/Kwh 5/Kwh Tax & Insurance cost/year 1% of initial Investment A. How many hours per year would be motors have to be operated so that annual cost will equal? B. If the motor have to be operated 500 hrs/year, which motor will you select? Motor B

Motor A Initial Investment 1,250,000 1,300,000 Horse Power 100Hp 100Hp Efficiency 74% 92% Useful Life 10 years 10 years MARR 15% 15% Maintenance Cost/year 50,000 25,000 Electrical cost 5/Kwh 5/Kwh Tax & Insurance cost/year 1% of initial Investment A. How many hours per year would be motors have to be operated so that annual cost will equal? B. If the motor have to be operated 500 hrs/year, which motor will you select? Motor B