1. Alpha’s Net Future Worth (NFW) at EOY5.

2. Beta’s Net Present (NPW) at EOY0.

3. Gamma’s NFW at EOY5.

4. Beta’s Annual Equivalent Worth (AEW).

 

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A cash crop specialist requires more significant harvesting capacity due to the purchase of an additional 900 acres of farmland. The parameter values of the three harvesters under consideration are provided below. Parameters 1. Initial Cost ($) Alpha 300,000 Beta Gamma 350,000 200,000 at ΕΟΥ1 390,000 increasing by $500 annually thereafter by $500 until EOY5; 206,000 at EOY6 increasing annually thereafter by 1% 113,000 at ΕΟΥ1 205,000 at ΕΟΥ1 235,000 annually from EOY1 to increasing annually thereafter by $500 2. Revenues ($) ΕΟΥ5 110,000 at ΕΟΥ1 115,000 at EOY1 increasing annually thereafter by 2% 3. Operating costs ($) increasing annually thereafter by increasing annually thereafter by 4% 2% 4. End-of-life salvage value ($) 5. Useful life (years) 10,000 -10,000 5 10 5 All parameter values are fictitious. EOY = End-of-year Industry standard for backhoes = 4 years MARR = 10% A cash crop specialist requires more significant harvesting capacity due to the purchase of an additional 900 acres of farmland. The parameter values of the three harvesters under consideration are provided below. Parameters 1. Initial Cost ($) Alpha 300,000 Beta Gamma 350,000 200,000 at ΕΟΥ1 390,000 increasing by $500 annually thereafter by $500 until EOY5; 206,000 at EOY6 increasing annually thereafter by 1% 113,000 at ΕΟΥ1 205,000 at ΕΟΥ1 235,000 annually from EOY1 to increasing annually thereafter by $500 2. Revenues ($) ΕΟΥ5 110,000 at ΕΟΥ1 115,000 at EOY1 increasing annually thereafter by 2% 3. Operating costs ($) increasing annually thereafter by increasing annually thereafter by 4% 2% 4. End-of-life salvage value ($) 5. Useful life (years) 10,000 -10,000 5 10 5 All parameter values are fictitious. EOY = End-of-year Industry standard for backhoes = 4 years MARR = 10%

Answer rating: 100% (QA)

1Alphas Net future worth at EOY 5 Net future worth Future worth of benefits Future worth of costs Ne... View the full answer