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2) (10 POINTS) You have just been hired on as a consultant to the prestigious Badger Consulting Group (BCG) due to your engineering economic analysis
2) (10 POINTS) You have just been hired on as a consultant to the prestigious Badger Consulting Group (BCG) due to your engineering economic analysis expertise. Before you have time to celebrate you are asked to analyze an investment by internet search giant, Foogle. Foogle is developing a new smart contact lens. To do so. Foogle needs to purchase a machine costing $15,000,000. This machine can last for 7 years, however since it is only to be used during development, Foogle will only keep it for 3 years. Due to the highly specific nature of the equipment, it can only be sold for $1,000,000 in the third year. a. (5 POINTS) Your client. Foogle, wants you to consider the impact of depreciation. You want to save them the most money. Should you advise them to use straight line or double declining balance depreciation? Show your work. 2) (10 POINTS) You have just been hired on as a consultant to the prestigious Badger Consulting Group (BCG) due to your engineering economic analysis expertise. Before you have time to celebrate you are asked to analyze an investment by internet search giant, Foogle. Foogle is developing a new smart contact lens. To do so. Foogle needs to purchase a machine costing $15,000,000. This machine can last for 7 years, however since it is only to be used during development, Foogle will only keep it for 3 years. Due to the highly specific nature of the equipment, it can only be sold for $1,000,000 in the third year. a. (5 POINTS) Your client. Foogle, wants you to consider the impact of depreciation. You want to save them the most money. Should you advise them to use straight line or double declining balance depreciation? Show your work
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