USE MARR = 8%

1.Three engineering designs have been presented to address an existing problem. Use the method of present worth and select among them for a useful life of six years. Then test the sensitivity of the decision to any assumption. A B First cost. $100000 175000 250000 Salvage value 10000 none 10000 Economic life 3 years 6 9 Operating cost 20000/yr 15000 9000 Maintenance cost 5000/yr 3000-first year, 5000 @3,6,9 Increases by 2000/yr