Select all true statements from the options below. Select 2 correct answer(s) The existing system should be replaced by option 2 immediately. The existing system should be replaced by option 1 immediately. The economic life of options 1 and option 2 is longer than the economic life of the existing system. The existing system should not be replaced because the EAC at year 1 is lower than option 1 and option 2. The existing system should be replaced by option 1 after 3 years. Option 2 has the longest economic life of 5 years. The existing system should be replaced by option 2 after 5 years.
Select all true statements from the options below. Select 2 correct answer(s) The existing system should be replaced by option 2 immediately. The existing system should be replaced by option 1 immediately. The economic life of options 1 and option 2 is longer than the economic life of the existing system. The existing system should not be replaced because the EAC at year 1 is lower than option 1 and option 2. The existing system should be replaced by option 1 after 3 years. Option 2 has the longest economic life of 5 years. The existing system should be replaced by option 2 after 5 years.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
5
![Select all true statements from the options below.
Select 2 correct answer(s)
The existing system should be replaced by option 2 immediately.
The existing system should be replaced by option 1 immediately.
The economic life of options 1 and option 2 is longer than the economic life of
the existing system.
The existing system should not be replaced because the EAC at year 1 is lower
than option 1 and option 2.
The existing system should be replaced by option 1 after 3 years.
Option 2 has the longest economic life of 5 years.
The existing system should be replaced by option 2 after 5 years.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fcd7fee95-968f-4f48-95e2-450a72c9d5a7%2F1f7349d8-89b8-49d5-ba8f-b664000201a4%2F04xdi18_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Select all true statements from the options below.
Select 2 correct answer(s)
The existing system should be replaced by option 2 immediately.
The existing system should be replaced by option 1 immediately.
The economic life of options 1 and option 2 is longer than the economic life of
the existing system.
The existing system should not be replaced because the EAC at year 1 is lower
than option 1 and option 2.
The existing system should be replaced by option 1 after 3 years.
Option 2 has the longest economic life of 5 years.
The existing system should be replaced by option 2 after 5 years.
![Question 1
A company is considering replacing its existing sheet metal laser-cutting machine
with a new model. The EAC values for the current machine and two possible
replacements are shown in the table.
EAC for
EAC for existing
system
EAC for
replacement option replacement option
N (years)
1
$9,550
$9,400
$9,030
$9,820
$12,780
$11,790
$10,410
$9.990
$10,130
2
$9,830
$9,280
$9,190
$9,020
$9,260
$9,370
$9,600
$9,970
$10,050
4
$10,210
$11,490
$12,820
$13,840
$15,150
$16,470
Select all true statements from the options below.
$9.330
$9,010
$9,150
$9,890
$10,220
$11,470
8.
10
Select 2 correct answerts)
The existing system should be replaced by option 2 immediately.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fcd7fee95-968f-4f48-95e2-450a72c9d5a7%2F1f7349d8-89b8-49d5-ba8f-b664000201a4%2Fdw7onp_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Question 1
A company is considering replacing its existing sheet metal laser-cutting machine
with a new model. The EAC values for the current machine and two possible
replacements are shown in the table.
EAC for
EAC for existing
system
EAC for
replacement option replacement option
N (years)
1
$9,550
$9,400
$9,030
$9,820
$12,780
$11,790
$10,410
$9.990
$10,130
2
$9,830
$9,280
$9,190
$9,020
$9,260
$9,370
$9,600
$9,970
$10,050
4
$10,210
$11,490
$12,820
$13,840
$15,150
$16,470
Select all true statements from the options below.
$9.330
$9,010
$9,150
$9,890
$10,220
$11,470
8.
10
Select 2 correct answerts)
The existing system should be replaced by option 2 immediately.
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