Alternative X Alternative Y Capital Investment Useful life $5,000 20 $200 $6,000 15 $800 in year 10 and decreasing by a constant amount of $50 per year Annual Expenses thereafter Salvage Value $1,000...


Alternative X<br>Alternative Y<br>Capital Investment<br>Useful life<br>$5,000<br>20<br>$200<br>$6,000<br>15<br>$800 in year 10 and<br>decreasing by a constant<br>amount of $50 per year<br>Annual Expenses<br>thereafter<br>Salvage Value<br>$1,000<br>(a) What is the annual worth (AW) of alternative X? Show all the steps of<br>calculation. (4 marks)<br>(b) What is the annual worth (AW) of alternative Y? Show all the steps of<br>calculation. (5 marks)<br>(c) Based on your answers in part (a) and (b), explain which alternative should<br>be selected. (2 marks)<br>LE10 Mec)<br>

Extracted text: Alternative X Alternative Y Capital Investment Useful life $5,000 20 $200 $6,000 15 $800 in year 10 and decreasing by a constant amount of $50 per year Annual Expenses thereafter Salvage Value $1,000 (a) What is the annual worth (AW) of alternative X? Show all the steps of calculation. (4 marks) (b) What is the annual worth (AW) of alternative Y? Show all the steps of calculation. (5 marks) (c) Based on your answers in part (a) and (b), explain which alternative should be selected. (2 marks) LE10 Mec)

Jun 09, 2022
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