N1

Draw CFDs for both options utilizing same life term. (hint: use the Least Common Multiplier between both options life terms) Option 1 Option 2 Life term (N) 5 years 10 Years Initial Cost $18,000 $15,000 $500 for year 1 then O&M Cost $700/year increasing by $45/year Annual Revenue $5000 $5,500 Salvage $5,000 $3,000