A company is going to buy a new machine for manufacturing its products. Three machines are available. Data is as follows:Money is worth 17% before taxes to the company. Which machine should be chosen?Use ROR ParametersB.First CostP24,000P30,000P49,600Power per year1,3001,3602,400Labor per year11,6009,3204,200Maintenance per year2,8001,9001,300Taxes and insurance3%3%3%Useful life55.

Given Information MARR before taxes = 17% We use the after-tax MARR, i.e 17% x (1 -t) to calculating…

mpany is going to buy a new machine for manufacturing its products. Three machines are available. Data is as follows: Money is worth 17% before taxes to the company. Which machine should be chosen? Use ROR

mpany is going to buy a new machine for manufacturing its products. Three machines are available. Data is as follows: Money is worth 17% before taxes to the company. Which machine should be chosen? Use ROR

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

A company is going to buy a new machine for manufacturing its products. Three machines are available. Data is as follows:

Money is worth 17% before taxes to the company. Which machine should be chosen?

Use ROR

Parameters
B.
First Cost
P24,000
P30,000
P49,600
Power per year
1,300
1,360
2,400
Labor per year
11,600
9,320
4,200
Maintenance per year
2,800
1,900
1,300
Taxes and insurance
3%
3%
3%
Useful life
5
5.

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