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Consider the data for the following two alternatives, X and Y. Use the benefit-to-cost ratio method to work the problem. MARR = 8% Alternative X
Consider the data for the following two alternatives, X and Y. Use the benefit-to-cost ratio method to work the problem. MARR = 8%
Alternative | X | Y |
First Cost | $100,000 | 140,000 |
Operating Costs/year | 50,000 | 60,000 |
Benefits/year | 100,000 | 120,000 |
Dis-benefits | 30,000 | 25,000 |
Life in years | 5 | 10 |
Ratio B / C = (EW of net benefits) / (EW of initial costs + EW of operating costs) EW - Equivalent Worth Determine the B / C ratio for X.
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