Consider the comparison between alternatives A and B. Using present worth method of analysis, and at an interest rate of 10% per year, the values of n that you should use in the uniform series factors to make a correct comparison are: ABFirst Cost₱500,000₱900,000Annual Operating Cost₱100,000₱40,000Salvage Value₱130,000₱150,000Life3 years6 years a. n=3 years for A and n=3 years for Bb. n=3 years for A and n=6 years for Bc. n=6 years for A and n=6 years for Bd. n=6 years for A and n=3 years for B

To make the comparison between mutually exclusive alternatives with present worth method, the…

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Consider the comparison between alternatives A and B. Using present worth method of analysis, and at an interest rate of 10% per year, the values of n that you should use in the uniform series factors to make a correct comparison are:

	A	B
First Cost	₱500,000	₱900,000
Annual Operating Cost	₱100,000	₱40,000
Salvage Value	₱130,000	₱150,000
Life	3 years	6 years

a. n=3 years for A and n=3 years for B

b. n=3 years for A and n=6 years for B

c. n=6 years for A and n=6 years for B

d. n=6 years for A and n=3 years for B

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