A heat exchanger is needed in a chemical process. If interest is 9% compounded annually, determine which of the following heat exchangers is cheaper by comparing the capitalized costs: Exchanger A costs P22,000 with a scrap value of P1,000 and a useful life of 7 years; Exchanger B costs P28,000 with a scrap value of P1,500 and a useful life of 10 years.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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A heat exchanger is needed in a chemical process. If interest is 9% compounded annually, determine which of the
following heat exchangers is cheaper by comparing the capitalized costs:
Exchanger A costs P22,000 with a scrap value of P1,000 and a useful life of 7 years;
Exchanger B costs P28,000 with a scrap value of P1,500 and a useful life of 10 years.
Capitalized cost of Exchanger A: Php
Capitalized cost of Exchanger B: Php
Note: Input numerical values only, do not type the units, space or comma.
Transcribed Image Text:A heat exchanger is needed in a chemical process. If interest is 9% compounded annually, determine which of the following heat exchangers is cheaper by comparing the capitalized costs: Exchanger A costs P22,000 with a scrap value of P1,000 and a useful life of 7 years; Exchanger B costs P28,000 with a scrap value of P1,500 and a useful life of 10 years. Capitalized cost of Exchanger A: Php Capitalized cost of Exchanger B: Php Note: Input numerical values only, do not type the units, space or comma.
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