Two mutually exclusive alternatives are available. If the interest is 15%, select the best alternative according to the VP method. The cash flow profiles for the alternatives are as follows. draw the diagram for those alternatives

Two mutually exclusive alternatives are available. If the interest is 15%, select the best alternative according to the VP method. The cash flow profiles for the alternatives are as follows. draw the diagram for those alternatives

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Two mutually exclusive alternatives are available. If the interest is 15%, select the best alternative according to the VP method. The cash flow profiles for the alternatives are as follows.

draw the diagram for those alternatives

Initial cost
Anual maintenance cost
Rescue valor
Useful life
Altternative 1
9000 $
2400$
0$
6 years
Alternative 2
6000$
1600$
300$
6 years

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