Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

There are two investment alternatives. Alternative A has an initial investment cost of 280000 TL. Yearly revenues of alternative A are 100000 TL and

 

There are two investment alternatives. Alternative A has an initial investment cost of 280000 TL. Yearly revenues of alternative A are 100000 TL and yearly expenses are 30000 TL. Additionally, there will be maintenance cost once every two years at 19000 TL. It has a useful life of 6 years and the salvage value at the end of 6 years is given as 50000 TL. Alternative B has an initial investment cost of 230000 TL. Yearly revenues of alternative B are 60000 TL and yearly expenses are 25000 TL. It has a useful life of 12 years and the salvage value at the end of 12 years is given as 35000 TL. If the MARR is determined as 8%, choose the best alternative using present worth method. (Assume repeatability)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

To determine the best alternative using the present worth method we need to calculate the present wo... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Engineering economy

Authors: Leland Blank, Anthony Tarquin

7th Edition

9781259027406, 0073376302, 1259027406, 978-0073376301

More Books

Students also viewed these Economics questions