Question: The Croc Co. is considering a new milling machine from among three alternatives: All machines have a life of 10 years, and MARR = 15%.

The Croc Co. is considering a new milling machine from among three alternatives:

Alternative Deluxe Regular Economy $75,000 $220,000 $125,000 First cost Annual benefit 79,000 43,000 28,000 Maintenance

All machines have a life of 10 years, and MARR = 15%. Using incremental rate of return analysis, which alternative, if any, should the company choose?

Alternative Deluxe Regular Economy $75,000 $220,000 $125,000 First cost Annual benefit 79,000 43,000 28,000 Maintenance and 38,000 13,000 8,000 L. operating costs Salvage value 6,900 16,000 3,

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