Initial cost -100,000 -250,000 a) Use Present Worth analysis to select the bette
ID: 1254993 • Letter: I
Question
Initial cost -100,000 -250,000
a) Use Present Worth analysis to select the better method.
b) For a study period of 3 years, use Present Worth analysis to select the better method.
An environment engineer must recommend one of two methods for monitoring high colony counts of E.coli and other bacteria in watershed area hot spots. Estimates are tabulated, and the MARR is per year. METHOD A METHOD B Initial cost -100,000 -250,000 Annual operating cost per year -30,000 in year 1 increasing by 5000 each year -20,000 Life (years) 3 6 a) Use Present Worth analysis to select the better method. b) For a study period of 3 years, use Present Worth analysis to select the better method.Explanation / Answer
well I am assuming that method A is on the left and that method B is on the right even though your picture says otherwise but the picture looks like it was squished. also i believe that the 3 is for the left method or methad A and the 6 is for the right method or method B, otherwise this question doesn't really make sense. anyways, method B is the better method because it costs less money up front so you have your money for longer. for the most part having your money for longer is almost always the better option, plus on top of that method B takes less money over all. for the second question method B is still a better choice becuase it costs less money over all even after including present worth.