Question

Consider the cash flows in problem #1. If MARR=20%, the benefit/cost ratio is closest to..

1. Given the characteristics below, the simple payback period for Altermative XYZ. Inc. is elosest to. Alternative XYZ, Inc Initial Cost Benefits 13 $80,000 per year S30,000 in year l; O&M Costs Remainingvears?ncreasebr5% more than the previous year Salvage $25,000 36S 52,01 a) 1.5 years b) 2.3 years d) 2.7 years 0 34 years 9)4.1 years h) 4.5 years i) 5.9 years j) cannot be calculated 2. Consider the cash flows in problem u 1 . If MARR-20%, the benefit/cost ratio is closest to a) 0.81 b) 0.82 30.83 d)0.85 e) 1.43 ) 1.51 ) 1.62 b) 1.7

I know the answer is c 0.83 but I don't know how to add an increasing O&M cost to my EUAC equation