please answer all with complete solution and draw the cash flow diagram,,, thank you.... Two mutually exclusive alternatives are being considered for the environmentalprotection equipment at a petroleum refinery. One of these alternatives must beselected. The firm's MARR is 10% per year. The estimated cash flows for eachalternative are as follows:Alternative AAlternative BCapital InvestmentAnnual Expenses$20,000$38,0004,0005,5001,000Market value at end of4,200useful lifeUseful life5 years10 yearsa. Assume the study period is shortened to five years. The market value ofAlternative B after five years is estimated to be $15,000. Which alternative wouldyou recommend? Use the AW Method.

The analysis of the equivalent worth of all the disbursements and receipts that are being estimated…

Two mutually exclusive alternatives are being considered for the environmental protection equipment at a petroleum refinery. One of these alternatives must be selected. The firm's MARR is 10% per year. The estimated cash flows for each alternative are as follows: Capital Investment Annual Expenses Alternative A $20,000 5,500 1,000 Alternative B $38,000 4,000 4,200 Market value at end of useful life Useful life 5 years 10 years a. Assume the study period is shortened to five years. The market value of Alternative B after five years is estimated to be $15,000. Which alternative would you recommend? Use the AW Method.

Two mutually exclusive alternatives are being considered for the environmental protection equipment at a petroleum refinery. One of these alternatives must be selected. The firm's MARR is 10% per year. The estimated cash flows for each alternative are as follows: Capital Investment Annual Expenses Alternative A $20,000 5,500 1,000 Alternative B $38,000 4,000 4,200 Market value at end of useful life Useful life 5 years 10 years a. Assume the study period is shortened to five years. The market value of Alternative B after five years is estimated to be $15,000. Which alternative would you recommend? Use the AW Method.

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

please answer all with complete solution and draw the cash flow diagram,,, thank you....

Two mutually exclusive alternatives are being considered for the environmental
protection equipment at a petroleum refinery. One of these alternatives must be
selected. The firm's MARR is 10% per year. The estimated cash flows for each
alternative are as follows:
Alternative A
Alternative B
Capital Investment
Annual Expenses
$20,000
$38,000
4,000
5,500
1,000
Market value at end of
4,200
useful life
Useful life
5 years
10 years
a. Assume the study period is shortened to five years. The market value of
Alternative B after five years is estimated to be $15,000. Which alternative would
you recommend? Use the AW Method.

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