Question: Two alternatives are being considered: Both alternatives provide an identical benefit. (a) Compute the payback period if Alt. B is purchased rather than Alt. A.

Two alternatives are being considered:

A в $500 $800 Initial cost 150 200 Uniform annual cost 8 Useful life, in years


Both alternatives provide an identical benefit.

(a) Compute the payback period if Alt. B is purchased rather than Alt. A.

(b) Use a MARR of 12% and benefit-cost ratio analysis to identify the alternative that should be selected.

A $500 $800 Initial cost 150 200 Uniform annual cost 8 Useful life, in years

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