5. Find best alternative using Benefit-Cost analysis method Useful Life MARR 50years 10% Project Capital Investment Annual maintenance Annual Benefit Market value cost AB $8,500,000 $750,000 $2,150,000 $1,250,000 $10,000,000 $725,000 $2,265,000 $1,750,000 C $12,000,000 $700,000 $2,500.000 $2,000,000
5. Find best alternative using Benefit-Cost analysis method Useful Life MARR 50years 10% Project Capital Investment Annual maintenance Annual Benefit Market value cost AB $8,500,000 $750,000 $2,150,000 $1,250,000 $10,000,000 $725,000 $2,265,000 $1,750,000 C $12,000,000 $700,000 $2,500.000 $2,000,000
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Certain new machinery when placed in service is estimated to cost $180,000. It is expected to reduce net annual operating expenses by $36,000 per year for 10 years and to have a market value $30,000 at the end of the 10tℎ year Develop the ATCF and BTCF Calculate BTROR and ATROR considering tax rate of 38%. The Machinery is in the MACRS five-year property class. Solve using excel spreadsheet Find best alternative using Benefit-Cost analysis method \table[[Useful Life,50 years,i.,,L],[MARR,10%,,,],[Project,\table[[Capital],[Investment]],\table[[Annual],[maintenance],[cost]],Annual Benefit,Market value],[A,$8,500,000,$750,000,$2,150,000,$1,250,000. Solve using excel spreadsheet
Transcribed Image Text:5. Find best alternative using Benefit-Cost analysis method
Useful Life
MARR
50years
10%
Project
Capital
Investment
Annual
maintenance
Annual Benefit
Market value
cost
AB
$8,500,000
$750,000
$2,150,000
$1,250,000
$10,000,000
$725,000
$2,265,000
$1,750,000
C
$12,000,000
$700,000
$2,500.000
$2,000,000
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