45. Three alternatives are being considered by the management of Brawn Engineering to satisfy an OSHA requirement for safety gates in the machine shop. Each of the gates will completely satisfy the requirement, so no combinations need to be considered. The fi rst costs, operating costs, and salvage values over a 5-year planning horizon are shown below. Using an internal rate of return analysis with a MARR of 20%/yr, determine the preferred gate.

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End of Year Gate 1 Gate 2 Gate 3 0 -$15,000 -$19,000 -$24,000 1 -$6,500 -$5,600 -$4,000 23410 -$6,500 -$5,600 -$4,000 3 -$6,500 -$5,600 -$4,000 -$6,500 -$5,600 -$4,000 5 -$6,500 + $0 -$5,600 + $2,000 -$4,000+ $5,000