A company is converting a mostly manual assembly line to a completely automated, robotic assembly line. A bid package is written asking potential vendors to propose the costs required to automate the assembly line. All vendors are asked to provide the equipment and installation cost, annual operating and maintenance cost, increasing yearly maintenance cost (if any), expected life of the equipment, and salvage value (if any). Four vendors have responded with the data shown in Table P2.33. The MARR for the project is 16%. Determine which vendor should be selected based on an economic analysis.

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TABLE P2.33 Vendor Costs for Installation of an Automated Assembly Line Vendor WERBST PIKUS BSTDEAL GR8SYS System Life (yr) 20 30 15 40 Initial Cost $2.3M $3.4M $1.8M $3.9M Annual Operating Cost $100,000 $90,000 $190,000 $50,000 Annual Maintenance Cost $6,500 $4,400 $9,000 $2,000 Additional Yearly Maintenance Cost after First Year $3,000 $2,500 $5,500 $0 Salvage Value $325,000 $550,000 $210,000 $720,000