Solved

Compare the Alternatives Shown Below on the Basis of Their

Question 5

Essay

Compare the alternatives shown below on the basis of their future worth, using an interest rate of 18% per year. Which alternative should be selected?  ernative MN tial costs $238,000$213,000$293,000 nual revenues $69,000 in year 1, increasing by $190 each year $114,000$69,000 in years 1 to 5,$69,570 in years 6 to 16 nual expenses $20,000$20,000 vage value $6000$25,000$6000 e, years 16$900016\begin{array} { l | c | c | c } \hline \text { ernative } & \mathbb { M } & \mathbb { N } \\\hline \text { tial costs } & \$ 238,000 & \$ 213,000 & \$ 293,000 \\\hline \text { nual revenues } & \begin{array} { c } \$ 69,000 \text { in year } 1 , \\\text { increasing by } \$ 190 \\\text { each year }\end{array} & \$ 114,000 & \begin{array} { l } \$ 69,000 \\\text { in years } 1 \text { to } 5 , \\\$ 69,570 \\\text { in years } 6 \text { to } 16\end{array} \\\hline \text { nual expenses } & \$ 20,000 & & \$ 20,000 \\\hline \text { vage value } & \$ 6000 & \$ 25,000 & \$ 6000 \\\hline \text { e, years } & 16 & \$ 9000 & 16 \\\hline\end{array}

Correct Answer:

verifed

Verified

FW(L) = $277,411.15
FW(M) = $2...

View Answer

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents