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Ottawa Hydro must replace its power pole transformers and has received the following per unit quotes from three transformers manufactures. Which manufacturer should be awarded
Ottawa Hydro must replace its power pole transformers and has received the following per unit quotes from three transformers manufactures. Which manufacturer should be awarded the contract? Note: Ottawa Hydro is a municipal crown corporation and does not pay income taxes SIEMENS: GE: Cost per unit: $12,500 Operating cost per unit: $3,500 per year Expected life per unit: 8 years Cost per unit: $11,500 Operating cost per unit: $3,000 per year Expected life per unit: 7 years MITSUBISHI: Cost per unit: $10,500 Operating cost per unit: $3,200 per year Expected life per unit: 6 years None of these answers SIEMENS as its quote has the highest EAC of $5,593 per unit. MITSUBHIi as it is lest expensive. SIEMENS as its units have the longest useful life. GE as its quote has the lowest EAC of $5,134 per unit
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