Baby Doll Shop currently manufactures wooden parts for dollhouses. Its sole worker is paid $8.10 an hour and, using a handsaw, can produce a year's required production (1,600 parts) in just eight weeks of 40 hours per week. That is, the worker averages five parts per hour when working by hand. The shop is considering the purchase of a power band saw with associated fixtures in order to improve the productivity of this operation. Three models of power saw could be purchased: Model A (economy version), Model B (high-powered version), and Model C (deluxe high-end version). The major operating difference between these models is their speed of operation. The investment costs, including the required fixtures and other operating characteristics, are summarized in the table below.

When you consider each model relative to the by hand option, you need to calculate the potential savings or benefits (which are cost reductions) each power band saw model might have relative to the handsaw option. Assume that MARR = 10%.

(a) Using the PW method, are there enough potential savings to make it economical to purchase any of the power band saws (A, B or C)?

(b) Using the ROR analysis, are there enough potential savings to make it economical to purchase any of the power band saws (A, B or C)? hint: Use incremental analysis