4. Compare the alternatives shown below on the basis of a present worth analysis, using an interest rate of 5% per year. (hand calculation Alternative P Alternative Q First Cost, $ -24,000 -32,000 Annual Operating cost, $ /year -3,200 -2,500 Salvage Value, $ 3,000 1,000 Life years 3 6. You should consider Least Common Multiple of (3 and 6) which is 6 years in your analysis instead of 3 years!

4. Compare the alternatives shown below on the basis of a present worth analysis, using an interest rate of 5% per year. (hand calculation Alternative P Alternative Q First Cost, $ -24,000 -32,000 Annual Operating cost, $ /year -3,200 -2,500 Salvage Value, $ 3,000 1,000 Life years 3 6. You should consider Least Common Multiple of (3 and 6) which is 6 years in your analysis instead of 3 years!

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 15PROB

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