Select the best alternative through internal rate of return analysis. Assume that the minimum attractive rate of return is 10% per year.     Machine X    |Machine Y Initial cost $ 400,000.00           $ 500,000.00 Annual operating cost $ 15,000.00 |$ 25,000.00 Annual profit $ 20,000.00 |$ 40,000.00 Residual value $ 85,000.00 |$ 100,000.00 Project life 15 years | none Engineering Economic Analysis

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
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Chapter8: Cost Analysis
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Select the best alternative through internal rate of return analysis. Assume that the minimum attractive rate of return is 10% per year.

    Machine X    |Machine Y
Initial cost $ 400,000.00           $ 500,000.00
Annual operating cost $ 15,000.00 |$ 25,000.00 Annual profit $ 20,000.00 |$ 40,000.00
Residual value $ 85,000.00 |$ 100,000.00
Project life 15 years | none

Engineering Economic Analysis

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