The Mowbot plant must replace an existing HVAC unit (doing nothing is not an option). You are evaluating two pieces of equipment. Each unit offers a saving in annual energy cost over the existing equipment. Alternative Unit A Unit B Unit C Up front cost $44,000 $65,000 84,000 Operating cost/year $1,900 $1,400 $1,900 Energy savings / year $17,500 $19500 $22,500 Salvage Value $2,000 $4,000 $1,000 Economic life, years 5 7 8. Mowbot's MARR is 18%. Based on annual worth analysis (not incremental), which unit should you recommend?
The Mowbot plant must replace an existing HVAC unit (doing nothing is not an option). You are evaluating two pieces of equipment. Each unit offers a saving in annual energy cost over the existing equipment. Alternative Unit A Unit B Unit C Up front cost $44,000 $65,000 84,000 Operating cost/year $1,900 $1,400 $1,900 Energy savings / year $17,500 $19500 $22,500 Salvage Value $2,000 $4,000 $1,000 Economic life, years 5 7 8. Mowbot's MARR is 18%. Based on annual worth analysis (not incremental), which unit should you recommend?
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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The Mowbot plant must replace an existing HVAC unit (doing nothing is not an option). You are evaluating two pieces of equipment. Each unit offers a saving in annual energy cost over the existing equipment. Alternative Unit A Unit B Unit C Up front cost $44,000 $65,000 84,000 Operating cost/year $1,900 $1,400 $1,900 Energy savings / year $17,500 $19500 $22,500 Salvage Value $2,000 $4,000 $1,000 Economic life, years 5 7 8. Mowbot's MARR is 18%. Based on annual worth analysis (not incremental), which unit should you recommend?
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