Required information Problem 05.030 DEPENDENT MULTI-PART PROBLEM - ASSIGN ALL PARTS An electric switch manufacturing company is trying to decide between three different assembly methods. Method A has an estimated first cost of $33,000, an annual operating cost (AOC) of $4,000, and a service life of 2 years. Method B will cost $76,000 to buy and will have an AOC of $3,500 over its 4-year service life. Method C costs $143,000 initially with an AOC of $6,000 over its 8-year life. Methods A and B will have no salvage value, but Method C will have equipment worth 12% of its first cost. Problem 05.030.b Future Worth Analysis Perform a present worth analysis to select the method at i = 13% per year. The present worth of method A is $ The present worth of method B is $ The present worth of method C is $ Method (Click to select) v is selected.

Required information Problem 05.030 DEPENDENT MULTI-PART PROBLEM - ASSIGN ALL PARTS An electric switch manufacturing company is trying to decide between three different assembly methods. Method A has an estimated first cost of $33,000, an annual operating cost (AOC) of $4,000, and a service life of 2 years. Method B will cost $76,000 to buy and will have an AOC of $3,500 over its 4-year service life. Method C costs $143,000 initially with an AOC of $6,000 over its 8-year life. Methods A and B will have no salvage value, but Method C will have equipment worth 12% of its first cost. Problem 05.030.b Future Worth Analysis Perform a present worth analysis to select the method at i = 13% per year. The present worth of method A is $ The present worth of method B is $ The present worth of method C is $ Method (Click to select) v is selected.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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