5. A small branch office of a contracting company is planning to purchase a new laser printer. Three vendors have supplied cost, useful life, and estimated salvage value data, shown in the following table. The MARR is 12%. Investment (first) cost Annual service cost Salvage value Useful life A $800 $180/yr $200 5 years Laser printer B $1,400 $150/yr $825 5 years C $900 $170/yr $100 5 years Draw cash flows for these alternatives. If the expected annual saving in labor is $500 regardless of which machine is purchased, what are the annual equivalent values of these alternatives.

5. A small branch office of a contracting company is planning to purchase a new laser printer. Three vendors have supplied cost, useful life, and estimated salvage value data, shown in the following table. The MARR is 12%. Investment (first) cost Annual service cost Salvage value Useful life A $800 $180/yr $200 5 years Laser printer B $1,400 $150/yr $825 5 years C $900 $170/yr $100 5 years Draw cash flows for these alternatives. If the expected annual saving in labor is $500 regardless of which machine is purchased, what are the annual equivalent values of these alternatives.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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