A process engineer is considering two options for a new product line. One of the options must be chosen. • To make a unit in-house, equipment costing $250,000 must be purchased. It will have a life of 4 years, annual operating costs of $80,000, and a salvage value of $95,000. Each unit will also cost $40 to manufacture. Buying the unit externally will cost $100 per unit. The company's MARR is 12% per year. a. If the anticipated volume is 2000 units per year, what is the annual equivalent cost for making the item in-house? [Select] b. If the anticipated v [Select] $222,430 [Select] $142,430 $182,430 $202,430 $262,430 e engineer should

A process engineer is considering two options for a new product line. One of the options must be chosen. • To make a unit in-house, equipment costing $250,000 must be purchased. It will have a life of 4 years, annual operating costs of $80,000, and a salvage value of $95,000. Each unit will also cost $40 to manufacture. Buying the unit externally will cost $100 per unit. The company's MARR is 12% per year. a. If the anticipated volume is 2000 units per year, what is the annual equivalent cost for making the item in-house? [Select] b. If the anticipated v [Select] $222,430 [Select] $142,430 $182,430 $202,430 $262,430 e engineer should

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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What is MARR value?
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