Two processes can be used for producing a polymer that reduces friction loss in engines. Process T will have a first cost of $600,00o, 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 $- and the present worth of process W is $- The process selected on the basis of the present worth analysis is process (Click to select)
Two processes can be used for producing a polymer that reduces friction loss in engines. Process T will have a first cost of $600,00o, 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 $- and the present worth of process W is $- The process selected on the basis of the present worth analysis is process (Click to select)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![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 S-
and the present worth of process W is $-
The process selected on the basis of thepresent worth analysis is process (Click to select)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa3669166-6a2b-4d26-94fb-4082343cb059%2F676ef58a-ce6c-44e7-83b8-17e049098d9b%2Fmddwkmo_processed.jpeg&w=3840&q=75)
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 S-
and the present worth of process W is $-
The process selected on the basis of thepresent worth analysis is process (Click to select)
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