There are two alternatives P,M. With 15% MARR under 20 years study period, which alternative should be chosen based on the following conditions and why ? For P, initial cost is $14k, yearly cost is $14k, Salvage is $8k and useful life is calculated as 5 years. For M, initial cost is $65k, yearly revenue is $9k, Salvage is $13k and useful life is calculated as 20 years.

There are two alternatives P,M. With 15% MARR under 20 years study period, which alternative should be chosen based on the following conditions and why ? For P, initial cost is $14k, yearly cost is $14k, Salvage is $8k and useful life is calculated as 5 years. For M, initial cost is $65k, yearly revenue is $9k, Salvage is $13k and useful life is calculated as 20 years.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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