The factory manager is considering the following two quotes from two vendors for purchace and maintanance...

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The factory manager is considering the following two quotes from two vendors for purchace and maintanance of an equipment. Vendor X's estimates are all in actual dollars, while Vendor Y's estimates are all in year-zero dollars. Vendor X Vendor Y $11,500 Initial cost $9,200 Annual cost $4,400 Service life (yrs) Salvage value 10 $3,680 $3,500 10 $4,600 The manager uses a before-tax real interest rate of 9% per year for economic analysis. If inflation rate is expected to average 2.75% per year over the next ten years, which vendor should the manager select that will minimize the before-tax cost of ownership? (a) Calculate PW for each alternative (use negative sign for costs) The PW of Vendor X's estimates is $ The PW of Vendor Y's estimates is $ (b) The most economical alternative is A. Vendor X O B. Vendor Y (Round to the nearest whole number.) (Round to the nearest whole number.) The factory manager is considering the following two quotes from two vendors for purchace and maintanance of an equipment. Vendor X's estimates are all in actual dollars, while Vendor Y's estimates are all in year-zero dollars. Vendor X Vendor Y $11,500 Initial cost $9,200 Annual cost $4,400 Service life (yrs) Salvage value 10 $3,680 $3,500 10 $4,600 The manager uses a before-tax real interest rate of 9% per year for economic analysis. If inflation rate is expected to average 2.75% per year over the next ten years, which vendor should the manager select that will minimize the before-tax cost of ownership? (a) Calculate PW for each alternative (use negative sign for costs) The PW of Vendor X's estimates is $ The PW of Vendor Y's estimates is $ (b) The most economical alternative is A. Vendor X O B. Vendor Y (Round to the nearest whole number.) (Round to the nearest whole number.)