Northwest Aerocomposite manufactures fibreglass and carbon fibre fairings. Its largest water-jet cutter will have to be...
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Northwest Aerocomposite manufactures fibreglass and carbon fibre fairings. Its largest water-jet cutter will have to be replaced some time before the end of four years. The old cutter is currently worth $49 000. Other cost data for the current and replacement cutters can be found in the tables that follow. The MARR is 15 percent. What is the economic life of the new cutter, and what is the equivalent annual cost for that life? When should the new cutter replace the old? Life in Years 0 1 2 Life in Years 0 Challenger Salvage Value $90 000 72 000 57 600 46 080 36 864 29 491 23 593 18 874 15 099 12 080 Defender Salvage Value $49 000 36 500 19 875 15 656 6742 Operating and Maintenance Costs $12000 THE 14 400 17 280 20 736 24 883 29 860 35 832 42 998 51 598 Operating and Maintenance Costs $17.000 21 320 26 806 33 774 Northwest Aerocomposite manufactures fibreglass and carbon fibre fairings. Its largest water-jet cutter will have to be replaced some time before the end of four years. The old cutter is currently worth $49 000. Other cost data for the current and replacement cutters can be found in the tables that follow. The MARR is 15 percent. What is the economic life of the new cutter, and what is the equivalent annual cost for that life? When should the new cutter replace the old? Life in Years 0 1 2 Life in Years 0 Challenger Salvage Value $90 000 72 000 57 600 46 080 36 864 29 491 23 593 18 874 15 099 12 080 Defender Salvage Value $49 000 36 500 19 875 15 656 6742 Operating and Maintenance Costs $12000 THE 14 400 17 280 20 736 24 883 29 860 35 832 42 998 51 598 Operating and Maintenance Costs $17.000 21 320 26 806 33 774
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