The estimates for two alternatives are to be compared on the basis of their perpetual equivalent annual worth. At an interest rate of 10% per year, the equation that represents the perpetual AW of Y1 is:

(a) AW_Y1 = ˆ’90,000(0.10) ˆ’ 4000 + 15,000(0.10)

(b) AW_Y1 = ˆ’90,000(0.10) ˆ’ 4000 + 15,000(Aˆ•F,10%,6)

(c) AW_Y1 = ˆ’90,000(0.10) ˆ’ 4000 ˆ’ 15,000(Pˆ•F,10%,3)(0.10) + 15,000(0.10)

(d) AW_Y1 = ˆ’90,000(Aˆ•P,10%,6) ˆ’ 4000 + 15,000(Aˆ•F,10%,6)

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Alternative Y1 X1 First cost, $ Annual cost, $/year Salvage value, $ - 50,000 -90,000 - 10,000 -4000 13,000 3 15,000 6. Life, years