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2. (6 pts) A major piece of your company's manufacturing equipment has failed and you need to buy a replacement. There are three alternatives. Which
2. (6 pts) A major piece of your company's manufacturing equipment has failed and you need to buy a replacement. There are three alternatives. Which one should be selected based on rate of return analysis if the company MARR is 10%? You only need to buy one. Option A Option B Option C Initial Cost $100,000 $120,000 $130,000 Annual Benefit $40,000 $32,000 $50,000 Salvage Value $30,000 $20,000 $30,000 Life 6 years 6 years Rate of Return 12% 9% 12.5% 3 years
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