Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Please answer in detailed steps Your company has asked you to recommend a new machine. After months of hard research, you have collected the following
Please answer in detailed steps
Your company has asked you to recommend a new machine. After months of hard research, you have collected the following data: Data Alternative A Alternative B Initial Cost Annual Benefit Gradient Benefit (0 first year, G second year, 2G $285,000 88,000 1,300 73,000 1,200 third year ..etc.) e & Operating Cost 18,000 600 34,000 1,100 Gradient Maintenance&Operating Cost (0 first year, G second year, 2G third year...etc.) Salvage Value Life, Years 42,000 48,000 Discussions with the accounting department reveal that a loan must be secured to purchase any machine. The loan data to cover the initial cost are as follows: Data Alternative A Alternative B 30% Loan Period, Years Annual Loan Payment $34,392.11 $37,441.93 The loan payments will be made annually with 12% interest. Your company assumes a MARR equal to 15%. Answer the following questions: 37. The analysis period you should use is: a. 24 years b. 21 years c. 12 years d. 18 years 38. The rate that you are going to use in comparing the alternatives is: a. b. C. d. 12% 15% 30% 13% 39. The equivalent uniform annual worth of the benefits for Alternative A over its useful life is: a. $73,000 b. $79,101 c. $75,516 d. $71,901Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started