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A construction company plans to purchase a new machine. The company needs to choose one machine among the three options shown in the table below.
A construction company plans to purchase a new machine. The company needs to choose one machine among the three options shown in the table below. Each machine has 5 years of useful life and MARR is 11%. Use the incremental B-C method to make the selection. Project A: Initial Investment: $650,000 Annual Cost: $70,000 Annual Revenue: $220,000 Market Value: $200,000 Project B: Initial Investment: $935,000 Annual Cost: $71,500 Annual Revenue: $264,000 Market Value: $308,000 Project C: Initial Investment: $1,170,000 Annual Cost: $78,000 Annual Revenue: $338,000 Market Value: $390,000 1) Please enter the incremental B/C ratio of the last comparison (please use modified B-C ratio)
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