A design change being considered by Mayberry, Inc., will cost ($ 6,000) and will result in an
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A design change being considered by Mayberry, Inc., will cost \(\$ 6,000\) and will result in an annual savings of \(\$ 1,000\) per year for the 6-year life of the project. A cost of \(\$ 2,000\) will be avoided at the project's end as a result of the change. MARR is 8 percent/year.
a. What is the present worth of this investment?
b. What is the decision rule for judging the attractiveness of investments based on present worth?
c. Should Mayberry implement the design change?
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Related Book For
Principles Of Engineering Economic Analysis
ISBN: 9781118163832
6th Edition
Authors: John A. White, Kenneth E. Case, David B. Pratt
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