Question
A piece of production equipment is to be replaced by a new automated model immediately because it no longer meets quality requirements for the end
A piece of production equipment is to be replaced by a new automated model immediately because it no longer meets quality requirements for the end product. The economic estimates for the new model are shown in the table below. The MARR is 15% per year.
Capital investment | $65,000 |
Annual expenses | $9,000 |
Useful life (years) | 20 |
Market value (at end of useful life) | $13,000 |
With a five-year study period, calculate the imputed market value of the new model:
Also, please find the AW within the study period:
(Please keep your answer in thousands of dollars and keep one decimal place, also add - sign if the result is negative).
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