The following two mutually exclusive alternative investments with different service lives are being compared at MARR of 6%. Alt. Q 15 Service life (years) Net PW (over service life) Net AW (over service life) Based on the information given, which of the two investments is more economical? $1,834,000 $249,182 Alt P 20 O A. Alt. P because it has a higher net PW OB. Alt Q because it has a higher net AW $2,312,000 $238,050

The following two mutually exclusive alternative investments with different service lives are being compared at MARR of 6%. Alt. Q 15 Service life (years) Net PW (over service life) Net AW (over service life) Based on the information given, which of the two investments is more economical? $1,834,000 $249,182 Alt P 20 O A. Alt. P because it has a higher net PW OB. Alt Q because it has a higher net AW $2,312,000 $238,050

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The following two mutually exclusive alternative investments with different service lives are being compared at MARR of 6%.
Alt. P
Alt. Q
15
20
Service life (years)
Net PW (over service life)
Net AW (over service life)
Based on the information given, which of the two investments is more economical?
$1,834,000
$249,182
A. Alt. P because it has a higher net PW
OB. Alt. Q because it has a higher net AW
$2,312,000
$238,050

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