Problem 05.023 Alternative Comparison - Different Lives Compare the alternatives C and D on the basis of a present worth analysis using an interest rate of 10% per year and a study period of 10 years. Alternative First Cost AOC, per Year Annual Increase in Operating Cost, per Year Salvage Value Life, Years The present worth of alternative C is $ C $-40,000 $-5,000 $-1,000 $15,000 10 D $-30,000 $-7,000 $-1,100 $1,000 5 and that of alternative D is $ Alternative C offers the lower present worth.
Problem 05.023 Alternative Comparison - Different Lives Compare the alternatives C and D on the basis of a present worth analysis using an interest rate of 10% per year and a study period of 10 years. Alternative First Cost AOC, per Year Annual Increase in Operating Cost, per Year Salvage Value Life, Years The present worth of alternative C is $ C $-40,000 $-5,000 $-1,000 $15,000 10 D $-30,000 $-7,000 $-1,100 $1,000 5 and that of alternative D is $ Alternative C offers the lower present worth.
Chapter1: Making Economics Decisions
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![Problem 05.023 Alternative Comparison - Different Lives
Compare the alternatives C and D on the basis of a present worth analysis using an interest rate of 10% per year and a study period of
10 years.
Alternative
First Cost
AOC, per Year
Annual Increase in Operating
Cost, per Year
Salvage Value
Life, Years
The present worth of alternative C is $
с
$-40,000
$-5,000
$-1,000
$15,000
10
D
$-30,000
$-7,000
$-1,100
$1,000
5
and that of alternative D is $
Alternative C offers the lower present worth.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1f832efa-b655-4686-9058-e21392a073f4%2Fa7e9840a-ede9-4181-842b-8e872c19a99b%2Fkftvvd_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 05.023 Alternative Comparison - Different Lives
Compare the alternatives C and D on the basis of a present worth analysis using an interest rate of 10% per year and a study period of
10 years.
Alternative
First Cost
AOC, per Year
Annual Increase in Operating
Cost, per Year
Salvage Value
Life, Years
The present worth of alternative C is $
с
$-40,000
$-5,000
$-1,000
$15,000
10
D
$-30,000
$-7,000
$-1,100
$1,000
5
and that of alternative D is $
Alternative C offers the lower present worth.
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