The manager of Liquid Sleeve Inc., a company that makes a sealing solution for machine shaft surfaces that have been compromisedby abrasion, high pressures, or inadequate lubrication, is considering adding Al or Fe nanoparticles to its solution to increase theproduct's performance at high temperatures. The costs associated with each are shown below. The company's MARR is 20% per year.Determine which nanoparticle type the company should select using an incremental rate of return analysis.Type FeFirst cost, $-145,000Annual operating cost,-86,000$ per yearSalvage value, $30,000Life, years2The incremental rate of return isSelect type (Click to select) ~%.Type Al-278,000-74,00070,0004

Part 2: Explanation:Step 1: Calculate the incremental net cash flows for each year.For Fe…

Answered: The manager of Liquid Sleeve Inc., a…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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vaibhav
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