rded Old Southwest Canning Co. has determined that any one of four sterilizing machines can be used in its chili-canning operation. The costs of the machines are estimated; all machines have a 5-year useful life. If the MARR is 25% per year, determine which machine should be selected on the basis of the rate of return (ROR) analysis. Machine 11 2 3 4 Select machine 3 First Cost, $ -28,100 -51,000 -32,000 -33,000 x Annual Operating Cost (AOC), $ -20,000 -12,000 -19,000 18,000

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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Old Southwest Canning Co. has determined that any one of four sterilizing machines can be used in its chili-canning operation. The
costs of the machines are estimated; all machines have a 5-year useful life. If the MARR is 25% per year, determine which machine
should be selected on the basis of the rate of return (ROR) analysis.
Machine
2
3
Select machine
First Cost, $
-28,100
-51,000
-32,000
-33,000
Annual Operating Cost
(AOC), $
-20,000
-12,000
-19,000
18,000
Transcribed Image Text:awarded pred Hint Old Southwest Canning Co. has determined that any one of four sterilizing machines can be used in its chili-canning operation. The costs of the machines are estimated; all machines have a 5-year useful life. If the MARR is 25% per year, determine which machine should be selected on the basis of the rate of return (ROR) analysis. Machine 2 3 Select machine First Cost, $ -28,100 -51,000 -32,000 -33,000 Annual Operating Cost (AOC), $ -20,000 -12,000 -19,000 18,000
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