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Answer the below questions from the information provided Paragon, a road construction company, must purchase a new paver to meet the growing demands for highway
Answer the below questions from the information provided
Paragon, a road construction company, must purchase a new paver to meet the growing demands for highway construction and resurfacing. The key parameters of the three pavers under scrutiny are provided below. Parameters A99 B88 C77 1. Initial Cost ($) 380,000 400,000 425,000 $290,000 at $300,000 at $310,000 from EOY1 increasing EOY1 EOY1 by $3,000 increasing by decreasing by 2. Revenues ($) annually 1% annually 3.0% annually thereafter thereafter. thereafter $125,000 at $175,000 at $185,000 at EOY1 EOY1 EOY1 3. Operating costs decreasing by decreasing by decreasing by ($) $1,000 annually 2% annually $2,500 annually thereafter. thereafter thereafter 4. End-of-life -6,000 45,000 30,000 salvage value ($) 5. Useful life (years) 3 years 4 years All parameter values are fictitious. EOY = End-of-year Industry Standard = 2.5 years MARR = 10% 6 years . 16. 17. The incremental B/C ratio between pavers C77 and A99. In this assignment, the conclusion of the benefit/cost ratio as to the best paver coincides with the conclusion of the Net Present Worth (NPW) method. 18. 19. B88's Internal Rate of Return (IRR). c77's Internal Rate of Return (IRR). The incremental Internal Rate of Return (AIRR) between pavers B88 and A99. 20Step by Step Solution
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