A warehouse company found that a faulty roofing system was costing it $15,750 per annum in maintenance, repairs, and damaged goods. It obtained the following information on three alternative new roof systems. Use incremental analysis to determine which alternative it should select when its MARR is 12%.

Installation Cost Annual Maintenance Annual Savings Nat Annual Savings Life Expectancy ALT x $80,000 $4,500 $15,750 51 1,250 15 years ALT Y 105,000 $2,000 $15,750 13,750 30 yea rs ALT 2 $124,000 $500 $15,750 $15,250 50 years