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A company needs a modern material handling system for facilitating access to and from a busy warehouse. If the companys management use a MARR =
A company needs a modern material handling system for facilitating access to and from a busy warehouse. If the companys management use a MARR = 10.4% in their economic decisions.The company found two systems, the first system is a second-hand and the second system is a new system.
Using excel: Using any equivalency analysis technique of your choice (PW or FW or AW), which alternative should the company pick? (explain why)
0 Second-hand System Investment cost $79,500 Annual expenses $21,000 Annual savings $37,100 Useful life 8 years Salvage value $10,600 Investment cost Annual expenses First year savings Useful life Salvage value New System $115,500 31 800 $56,200 decreasing by $850 each year thereafter 16 years $25,800Step by Step Solution
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