Two alternatives for recreational facility are being considered. Their cash flow profiles are as follows for lives of 5 and 3 years, respectively. Each alternative is expected to repeat forever with roughly the same net cash flow profile. Using the capitalized worth method and a MARR of 10%, select the preferred alternative. ANSWERS : CW alt 1 = PhP CW alt 2 = PhP Alternative ____ is the best.   **solve using formula Capitalized Worth = Annual Worth/Interest or  CW = A(1/i)

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
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Chapter1: Making Economics Decisions
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Two alternatives for recreational facility are being considered. Their cash flow profiles are as follows for lives of 5 and 3 years, respectively.

Each alternative is expected to repeat forever with roughly the same net cash flow profile. Using the capitalized worth method and a MARR of 10%, select the preferred alternative.

ANSWERS :

CW alt 1 = PhP

CW alt 2 = PhP

Alternative ____ is the best.

 

**solve using formula Capitalized Worth = Annual Worth/Interest or  CW = A(1/i)

Year Net Cash Flow Alt 1 Net Cash Flow Alt 2
- PhP 11,000
- PhP 5000
1
5,000
2,000
2
4,000
3,000
3,000
3,000
4
2,000
5
1,000
3.
Transcribed Image Text:Year Net Cash Flow Alt 1 Net Cash Flow Alt 2 - PhP 11,000 - PhP 5000 1 5,000 2,000 2 4,000 3,000 3,000 3,000 4 2,000 5 1,000 3.
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