7. Assuming that Alternatives B and C are replaced with identical units at the end of...

Transcribed Image Text:

7. Assuming that Alternatives B and C are replaced with identical units at the end of their useful lives, and an 8% interest rate, which alternative should be chosen? Use an annual cash flow analysis. Cost Annual benefit Useful life (yrs.) A $12,500 1,500 00 B $15,000 3,500 7 C $17,500 2,500 15 7. Assuming that Alternatives B and C are replaced with identical units at the end of their useful lives, and an 8% interest rate, which alternative should be chosen? Use an annual cash flow analysis. Cost Annual benefit Useful life (yrs.) A $12,500 1,500 00 B $15,000 3,500 7 C $17,500 2,500 15

Answer rating: 100% (QA)

Here is the annual cash flow analysis for each alternative Alternative Initial Cost Annual Benefit N... View the full answer