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Consider the following EOY cash flows for two mutually exclusive alternatives(one must be chosen): Alternative A Alternative B Capital Investment 9000 15000 Annual Expenses 2000

Consider the following EOY cash flows for two mutually exclusive alternatives(one must be chosen):

Alternative A Alternative B
Capital Investment 9000 15000
Annual Expenses 2000 2000
Useful Life(years) 3 8
Market value at the end of the useful life 2100 2300

The MARR is 8% per year.

a)Determine which alternative should be selected if the repeatability assumption applies.Use PW in your analysis.

PW for A(PWA) ?
PW for B(PWB) ?
Which one is preferred?

b)Determine which alternative should be selected if the analysis period is 8 years and the repeatability assumpiton does not apply.Use the AW method.

AW for A(AWA) ?
AW for B(AWB) ?
Which one is preferred?

PLEASE SOLVE BOTH CHOICE ( a and b)

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