Problem 5) The following annual costs are associated with three new extruder machines being considered for use in a Styrofoam cup plant: Data X-TRUD SUPR-X Useful-Life, Years 9. 13 11 First Cost $2,300,000 $2,780,000 $2,540,000 Salvage Value 82,000 118,000 97,000 Annual Benefit 580,000 670,000 650,000 M&O 65,000 78,000 71,000 M&O Gradient 11,000 15,000 12,500 The company's interest rate (MARR) is 12%. Which extruder should the Styrofoam Company choose? Use Annual Cash Flow Analysis.
Problem 5) The following annual costs are associated with three new extruder machines being considered for use in a Styrofoam cup plant: Data X-TRUD SUPR-X Useful-Life, Years 9. 13 11 First Cost $2,300,000 $2,780,000 $2,540,000 Salvage Value 82,000 118,000 97,000 Annual Benefit 580,000 670,000 650,000 M&O 65,000 78,000 71,000 M&O Gradient 11,000 15,000 12,500 The company's interest rate (MARR) is 12%. Which extruder should the Styrofoam Company choose? Use Annual Cash Flow Analysis.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![Problem 5)
The following annual costs are associated with three new extruder machines being
considered for use in a Styrofoam cup plant:
Data
X-TRUD
SUPR-X
Useful-Life, Years
9.
13
11
First Cost
$2,300,000
$2,780,000
$2,540,000
Salvage Value
82,000
118,000
97,000
Annual Benefit
580,000
670,000
650,000
M&O
65,000
78,000
71,000
M&O Gradient
11,000
15,000
12,500
The company's interest rate (MARR) is 12%. Which extruder should the Styrofoam
Company choose? Use Annual Cash Flow Analysis.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F09b3997c-2096-4573-b74b-055c69181c0d%2F4dfe5988-838f-48f5-ae73-3246c178a89d%2Fd3bwlqh_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 5)
The following annual costs are associated with three new extruder machines being
considered for use in a Styrofoam cup plant:
Data
X-TRUD
SUPR-X
Useful-Life, Years
9.
13
11
First Cost
$2,300,000
$2,780,000
$2,540,000
Salvage Value
82,000
118,000
97,000
Annual Benefit
580,000
670,000
650,000
M&O
65,000
78,000
71,000
M&O Gradient
11,000
15,000
12,500
The company's interest rate (MARR) is 12%. Which extruder should the Styrofoam
Company choose? Use Annual Cash Flow Analysis.
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