The equivalent annual costs for system A are $

The equivalent annual costs for system B are $

The equivalent operating cost per hour for process A is $

The equivalent operating cost per hour for process B is $

Which engine system should be selected? Choose the correct answer below.

System A or System B

An airline is considering two types of engine systems for use in its planes. Each has the same life and the same maintenance and repair record System A costs $90,000 and uses 45,000 gallons per 1,000 hours of operation at the average load encountered in passenger service. System B costs $220,000 and uses 32,000 gallons per 1,000 hours of operation at the same level. Both engine systems have three-year lives before any major overhaul is required. On the basis of the initial investment, the systems have 17% salvage values. I jet fuel costs S2.19 a gallon year 1 and fu consumption is expected to increase at the rate of 5% per year because of degrading engine efficiency, which engine system should the firm install? Assume 3,000 hours of operation per year and a MARR of 14% Use the AE criterion. What is the equivalent operating cost per hour for each engine? Assume an end-of-year convention for the fuel cost. An airline is considering two types of engine systems for use in its planes. Each has the same life and the same maintenance and repair record System A costs $90,000 and uses 45,000 gallons per 1,000 hours of operation at the average load encountered in passenger service. System B costs $220,000 and uses 32,000 gallons per 1,000 hours of operation at the same level. Both engine systems have three-year lives before any major overhaul is required. On the basis of the initial investment, the systems have 17% salvage values. I jet fuel costs S2.19 a gallon year 1 and fu consumption is expected to increase at the rate of 5% per year because of degrading engine efficiency, which engine system should the firm install? Assume 3,000 hours of operation per year and a MARR of 14% Use the AE criterion. What is the equivalent operating cost per hour for each engine? Assume an end-of-year convention for the fuel cost