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A construction company has two alternatives to buy an excavator that is to be used at a construction site for excavation of earth. The cash

image text in transcribed A construction company has two alternatives to buy an excavator that is to be used at a construction site for excavation of earth. The cash flow details of the two alternatives are as follows; Alternative 1: Initial purchase cost $585,000, Salvage value $150,000, useful life 14 years, Operating cost: the operating cost for excavating Im3 of earth is $20. Alternative I can excavate 65 m3 of earth in one hour. Alternative 2: Initial purchase cost-$660,000, salvage value $175000, useful life 14 years, Operating cost: the operating cost for excavating Im3 of earth is $14. Alternative 2 can excavate 75 m3 of earth in one hour. If the company's minimum attractive rate of return (MARR) is 12% per year. How many hours approximately the excavators have to operate per year for the equivalent uniform annual worth of cash flows of both the alternatives to be equalimage text in transcribed

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