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could you please solve and explain the question with details Rocc is a tier 1 Automotive Supplier. They are choosing between two 3-D printing machines,
could you please solve and explain the question with details
Rocc is a tier 1 Automotive Supplier. They are choosing between two 3-D printing machines, A and B, of comparable specifications to help reduce the time needed in building prototypes for new parts and subassemblies. The company has a MARR (Minimum Acceptabie Rate of Return) of 8%. Expected salvage value for each of the two 3-D printing machines at the end of their service lives is $7,500. Answer the following questions using the information in the table below, 3-D Printing Machine A 3-D Printing Machine B Down payment $11,000 $12,000 Running cost per year $1000 $900 Maintenance cost $150 for the first year, increasing by $160 for the first year, increasing $110/year thereafter by $100/year thereafter Service cost per year $3,000 $2,800 Service Life 10 years 12 years a) State the necessary assumption for comparing mutually exclusive alternatives of different lives (4 Marks) b) Based on Annual Worth comparison, which alternative should be selected? (6 Marks) c) Based on Present Worth comparison, which alternative should be selected? (6 Marks) d) Do both methods (Present Worth and Annual Worth) always yield the same decision? (3 Marks) e) For a ten-year study period, what salvage value for Machine B would make it a better choice? (6 Marks) RCC is a tier | Automotive Supplier. They are choosing between two 3-D printing machines andel and comparable specifications to help reduce the time needed in building prototypes for new parts and value for each of the two 3-D printing machines at the end of their service lives is $7,500. Answer the following questions using the information in the table below. 3-D Printing Machine A 3-D Printing Machine B Down payment $11,000 SI2,000 Running cost per year $1000 $900 Maintenance cost S150 for the first year, increasing by $160 for the first year, increasing $110/year thereafter by $100/year thereafter Service cost per year $3,000 $2,800 Service Life 10 years 12 years a) State the necessary assumption for comparing mutually exclusive alternatives of different lives (4 Marks) b) Based on Annual Worth comparison, which alternative should be selected? (6 Marks) c) Based on Present Worth comparison, which alternative should be selected? (6 Marks) d) Do both methods (Present Worth and Annual Worth) always yield the same decision? (3 Marks) e) For a ten-year study period, what salvage value for Machine B would make it a better choice? (6 Marks) Step by Step Solution
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