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Your company needs to purchase a new furnace and has narrowed the choices down to two furnaces. The first furnace costs $3,000 and has an
Your company needs to purchase a new furnace and has narrowed the choices down to two furnaces. The first furnace costs $3,000 and has an estimated annual operation cost of $1,050. The second furnace costs $3,500 and has an estimated annual operation cost of $950. The estimated life of both furnaces is 15 years. Using a MARR of 15%, what is the net present cost of each of these furnaces? Which furnace should your company purchase?
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