O1) Engineering economics:

Q1 (5 marks) A plant manager is considering the purchase of a new weigh scale that will improve the performance of a particular packaging-machine. Two different scale manufacturers have provided quotations: Purchase Cost Annual Benefit Salvage Value Scale 1 $2,000 $450 $100 Scale 2 $3,000 $600 $700 If both scales have a 6-year useful life and the interest rate is 8%, which scale should the manager purchase? Use the PW method of analysis