Question
MARR is 10%. You are offered two projects that have different lifetimes: As life 3 years and Bs life is 5 years. As cost is
MARR is 10%. You are offered two projects that have different lifetimes: As life 3 years and Bs life is 5 years. As cost is $10,000 today followed by a benefit of $5,000/year for three years., beginning a year later, Bs cost is $14,000 followed by a benefit of $4,600/year for five years, beginning a year later. a) Calculate the EUAW of A and B. b) If the projects are to be repeated, which project would you choose? c) If the projects are not to be repeated, that is, if you choose A, it ends in 3 years and if you choose B, it ends in 5 years, then, which one would you choose?
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