General Motors is considering two different processes for battery manufacturing for its hybrid vehicles. Process A has initial cost of 205,000, AOC: 29,000, salvage value of 2,000 after 2 years. Process B has initial cost of 235,000, AOC: 27,000, salvage value of 20,000 after 4 years. Which process should be selected based on present worth analysis at 10% interest?

General Motors is considering two different processes for battery manufacturing for its hybrid vehicles. Process A has initial cost of 205,000, AOC: 29,000, salvage value of 2,000 after 2 years. Process B has initial cost of 235,000, AOC: 27,000, salvage value of 20,000 after 4 years. Which process should be selected based on present worth analysis at 10% interest?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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