The manager of a canned-food processing plant has two labeling machine options. On the basis of a rate of return analysis with a MARR of 20% per year, determine (a) which model is economically better, and (b) if the selection changes, provided both options have a 4-year life and all other estimates remain the same. Model 105 200 First cost, $ −15,000 −25,000 AOC, $ per year −1,600 −400 Salvage value, $ 3,000 4,000 Life, years 2 4

A company that manufactures high-speed submersible rotary-indexing spindles is considering an upgrade of production equipment to reduce costs over the next 5 years. The company can invest $80,000 now, 1 year from now, or 2 years from now. Depending on when the investment is made, the savings will vary. The saving estimates are $23,000, $29,500, or $38,000 per year if the investment is made now, 1 year from now, or 2 years from now, respectively. The company will only invest if the ROR is at least 20% per year. Using a future worth analysis, determine if the timing of the investment will affect the return requirement and, if so, when the investment should be made

ABC Beverage, LLC, purchases its 355-ml cans in large bulk from Wald-China Can Corporation. The finish on the anodized aluminum surface is produced by mechanical finishing technologies called brushing or bead blasting. Engineers at Wald are switching to more efficient, faster, and cheaper machines to supply ABC. Use the estimates and MARR = 8% per year to select between the two alternatives.     Brush Alternative Bead Blasting Alternative P $-400,000 $-400,000 n 6 years large Salvage Value $50,000 no value  AOC Nonlabor $-60,000 in year 1, decreasing by $2500 annually starting in year 2 $-70,000 per year

The cost of the extending a certain road at Yellowstone National Park is $1.7 million. Resurfacing and other maintenance are expected to cost $350,000 every 3 years with an interest rate of 6% per year.   a) What is the Annual Worth based capitalized cost of the road?   b) How will the answer (a) change if its Salvage is expected to be $3 million at the end of its useful Life?