Considering the scenario, A firm is considering which of three alternatives to implement for the purpose of decreasing production cycle time and increasing Overall Equipment Efficiency (OEE) for one of their current manufacturing processes. Below is a summary for these three alternatives: Alternative 1: 2 second permanent reduction in cycle time 4.5% permanent increase in OEE Cost to purchase the alternative: $50,000 Alternative 2: 3.5 second reduction in cycle time for the first year of implementation. This cycle time reduction is expected to decrease by 0.5 second each year in subsequent years. 5.75% increase in OEE for the first year of implementation. OEE is expected to decrease by 0.25% each year in subsequent years. Cost to purchase the alternative: $52,000 Alternative 3: 2.5 second permanent reduction in cycle time 4.25% permanent increase in OEE Cost to purchase the alternative: $48,000 Manufacturing process and economic information: Assume a 10% nominal interest rate, compounded yearly. Annual Production Volume: 120,000 units per year with an annual reduction of 5,000 parts per year till end of production (EOP) schedule. Number of years left of this manufacturing process: 5 years (from current year). Kaizen team defined a 1% increase in OEE is equivalent to a saving of $10 per part; a 1 second reduction of cycle time is equivalent to $5 per part. You can assume that OEE/cycle time increase/decrease are directly proportional. Please use PRESENT WORTH ANALYSIS to analyze and suggest the best alternative for this scenario.