Question: please complete by hand and show a present worth analysis. engineering economics. below is an example in notes: You then calculate the present worth of

please complete by hand and show a present worth analysis. engineering economics.  please complete by hand and show a present worth analysis. engineering
below is an example in notes:
economics. below is an example in notes: You then calculate the present

You then calculate the present worth of this cash flow P--234 132 + (-234 132XP/F, 896, 5) -234 132+ (-234 132)X0.68058) -393 477 THIS IS THE ACTUAL PRESENT WORTH YOU NEED TO COMPARE THE TWO PROJECTS For Machine B we are already dealing with a 10 year lifespan so we simply calculate the present wo using the cash flow diagram. Repeated lives is not needed for this cash flow diagram Machine B: P =-2 000 000 +(1 100 000-800 000)(PIA, 8%, 10) + 200 000(PF, 896, 10) =-2 000 000 + 300 000(6.7101) + 200 000(0.46319) 105 668 Again, only machine B should be purchased because it has the highest present worth

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!