Use FW analysis to compare between machines A and B if the MARR is 10% Machine...
Use FW analysis to compare between machines A and B if the MARR is 10%
| Machine A | Machine B | |
| First Cost, $ | -20,000 | -30,000 |
| Annual Cost, $ year | -9000 | -7000 |
| Salvage Value, $ | 4000 | 6000 |
| Life | 3 | 6 |
|
|
Homework Answers
Future Worth of A = -20000(F/P, 10%, 6) – 20000(F/P, 10%, 3) – 9000(F/A, 10%, 6) + 4000(F/P, 10%,
3) + 4000
= -20000*1.7716 – 20000*1.3310 - 9000*7.7156 + 4000*1.3310 + 4000
= -122,168
Future worth of B = -30000(F/P, 10%, 6) – 7000(F/A, 10%, 6) + 6000
= -30000*1.7716 – 7000*7.7156 + 6000
= - 101,156
Select B because it has a greater present worth at - 101,156
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Use FW analysis to compare between machines A and B if
the MARR is 10%
Machine...
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