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North-Star Manufacturing Company, in southern Ontario, is looking to upgrade its Hydro-forming operation. The engineering department is choosing between two hydro forming press models (Press
North-Star Manufacturing Company, in southern Ontario, is looking to upgrade its Hydro-forming operation. The engineering department is choosing between two hydro forming press models (Press A, or B). The company has a MARR (Minimum Acceptable Rate of Return) of 9%. Salvage value for both presses at the end of their service lives is expected at $150,000. Answer the following questions using the information in the table below. What is the assumption needed in comparing mutually exclusive alternatives of different lives? Based on Annual Worth comparison, which alternative should be selected? Based on Present Worth comparison, which alternative should be selected? Do both methods (Present Worth and Annual Worth) always yield to the same decision? For a twenty-year study period, what salvage value for press B would make it a better choice
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