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a)- If the MARR for the company is 8%, which column do you recommend? First costa Annual benefits Salvage values Annual Maint
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Answer #1

Let us calculate Annual worth of alternatives for comparison:

Packed column:

Net annual benefit = 78,000 - 4,000 = 74,000

AW = -787,100(A/P, 8%, 45) + 74,000 + 99,000(A/F, 8%, 45)

      = -787,100(0.0826) + 74,000 + 99,000(0.00259)

      = -65,014.46 + 74,000 + 256.41

      = $9241.95

Tray column:

Net annual benefit = 70,000 - 2,000 = 68,000

AW = -684,220(A/P, 8%, 34) + 68,000 + 40,000(A/F, 8%, 34)

      = -684,220(0.0863) + 68,000 + 40,000(0.00630)

      = -59,048.19 + 68,000 + 252

      = $9203.81

Since AW of packed column is more than Tray-column, therefore, I will recommend packed column.

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