Two processes can be used for producing a polymer that reduces friction loss in engines. Process T will have a first cost of $600,000, an operating cost of $84,000 per year, and a salvage value of $80,000 after its 2-year life. Process W will have a first cost of $1,320,000, an operating cost of $25,000 per year, and a $120,000 salvage value after its 4-year life. Process W will also require updating at the end of year 2 at a cost of $90,000. Which process should be selected on the basis of a present worth analysis at a MARR of 12% per year? The present worth of process T is $-465,476.1, and the present worth of process W is $- 1,148,684. The process selected on the basis of the present worth analysis is process T
Two processes can be used for producing a polymer that reduces friction loss in engines. Process T will have a first cost of $600,000, an operating cost of $84,000 per year, and a salvage value of $80,000 after its 2-year life. Process W will have a first cost of $1,320,000, an operating cost of $25,000 per year, and a $120,000 salvage value after its 4-year life. Process W will also require updating at the end of year 2 at a cost of $90,000. Which process should be selected on the basis of a present worth analysis at a MARR of 12% per year? The present worth of process T is $-465,476.1, and the present worth of process W is $- 1,148,684. The process selected on the basis of the present worth analysis is process T
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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Transcribed Image Text:Two processes can be used for producing a polymer that reduces friction loss in engines. Process T will have a first cost of $600,000,
an operating cost of $84,000 per year, and a salvage value of $80,000 after its 2-year life. Process W will have a first cost of
$1,320,000, an operating cost of $25,000 per year, and a $120,000 salvage value after its 4-year life. Process W will also require
updating at the end of year 2 at a cost of $90,000. Which process should be selected on the basis of a present worth analysis at a
MARR of 12% per year?
The present worth of process T is $- 465,476.1, and the present worth of process W is $— 1,148,684.
The process selected on the basis of the present worth analysis is process T
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