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A retrofitted space-heating system is being considered for a small office building. The system can be purchased and installed for $122,000, and it will save
A retrofitted space-heating system is being considered for a small office building. The system can be purchased and installed for $122,000, and it will save an estimated 350,000 kilowatt-hours (kWh) of electric power each year over a seven-year period. A kilowatt-hour of electricity costs $0.07, and the company uses a MARR of 13% per year in its economic evaluations of refurbished systems. The market value of the system will be $9,000 at the end of seven years, and additional annual operating and maintenance expenses are negligible. Use the benefit-cost method to make a recommendation. The benefit-cost ratio of the system with PW is (Round to two decimal places.)
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