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A firm is considering three mutually exclusive alternatives as part of an upgrade to an

A firm is considering three mutually exclusive alternatives as part of an upgrade to an existing transportation network. Supp

A firm is considering three mutually exclusive alternatives as part of an upgrade to an existing transportation network. Suppose the study period has been coterminated at 10 years. Use the imputed market value technique and determine which alternative is the most economical at MARR = 9% per year. Installed cost Net annual revenue Salvage value Useful life Calculated IRR $40,000 $25,000 $6,500 $5,600 0 0 20 years 20 years 15.3% 22.0% $20,000 $5,250 0 10 years 22.9% Click the icon to view the interest and annuity table for discrete compounding when i = 9% per year. The PW of alternative / is $ 13,600. (Round to the nearest hundreds.) The PW of alternative Il is $ 18,400(Round to the nearest hundreds.) The PW of alternative Ill is $ 13693. (Round to the nearest hundreds.) Which alternative is the most economical? Choose the correct answer below. A. Alternative III B. Alternative Il O C. Alternative

Feb 06 2020 View more View Less

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