Question: 4. Consider the three mutually exclusive alternatives summarized below. Note that Alternative B has a disposal cost, while alternatives A and C have salvage values.

 4. Consider the three mutually exclusive alternatives summarized below. Note that

4. Consider the three mutually exclusive alternatives summarized below. Note that Alternative B has a disposal cost, while alternatives A and C have salvage values. Compare the alternatives using an analysis period of 12 years and assuming that each alternative can be repeated with an identical replacement at the end of its useful life. If the firm has a 10% MARR, which alternative should be chosen? Clearly indicated the preferred alternative. You may use any appropriate method. A B C Initial Cost $ 10,000 $ 15,000 $ 12,000 Annual Revenues $ 6,000 $ 8.000 $ 5,000 Salvage Value S 3,000 $ -2.000 $1,000 Useful life (yrs) 2 3 4

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