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X company is adding a new AC unit to keep the workplace feeling nice. 3 different AC units are available to choose from, so your

X company is adding a new AC unit to keep the workplace feeling nice. 3 different AC units are available to choose from, so your facilities engineers must evaluate from among this set of three mutually exclusive alternatives. Initial capital investment and annual expenses for each alternative are given in the table below. Using a MARR of 12%, which AC unit should be chosen? Use incremental analysis. Post EXCEL sheet and forumals

AC Unit

1

2

3

4

5

Investment

$50,000

$67,000

$100,000

$105,000

$120,000

Useful Life

10 Years

10 Years

10 Years

10 Years

10 Years

Total Annual Expense

$15,000

$13,000

$10,000

$7000

$4000

Market Value

$500

$1000

$3000

$0

$5000

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