1. Hospital is evaluating the purchase of new office equipment from three vendors. Assume MARR=15% and 4 year useful life on all equipment. Select best vendor. Assume: Analysis period = useful life = 4 yrs Company A Company B Company C First Cost $15K $25K $20K Annual O&M 1600 400 900 Annual Benefit 8K 13K 11K Salvage Value 3K 6K 4.5K What is the NPV of company B? - If had $500,000 today in an account earning 10% each year, how much could you you withdraw each year for 25 years?

A new bridge project is being evaluated at i = 20%. Recommend an alternative based on the capitalized cost for each. AnnualO&M Life(years) $250,000 $500,000 Construction Cost Concrete $50million Steel $40million Solution: 1. Here 2. CC concrete 50 3. CC steel 4. Choose capitalized cost (CC). million dollars; million dollars; 70 50

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Fitzgerald, Ivy, Garcia, Nichols, Eudy, Williams, Thomas, Owens, and Nagy (FIGNEWTON) Inc. must replace its fig - crushing equipment. The alternatives under consideration are presented below. Alternative First Cost Net Annual Benefits Useful Life A $170, 500 $14, 675 5 years B 205,000 17,000 7 years C 242,500 16, 350 8 years D 290,000 14,825 10 years a) Which anlaysis method should be used to select the alternative? b) Why should that analysis method be used? c) if FIGNEWTON uses a MARR of 8%, what alternative should be chosen? d) if FIGNEWTON uses a MARR of 18%, what alternative should be chosen? Submit one excel file with answers a), b), c) and d) highlighted clearly.

1. An industrial plant is considering the purchase of a centrifugal pump. Three offers were received and basis of selection have been tabulated as follows:   Offer A Offer B Offer C Price of pump P60,000 P96,000 P120,000 Economic life, years 3 5 10 Salvage value at end of economic life   5,000   10,000   8,000 Yearly maintenance cost   10,000   6,000   5,000       .                   If cost of money is 14%, what offer would you recommend to be purchased? Use the rate of return method, the annual cost method, present worth method and equivalent uniform annual cost method for the evaluation Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.