Titan manufactures and sells gas powered electricity generators, It can purchase a new fine of fuel injectors from elther of two companies: A or B. The AOCand annual savings estimates are availoble, but the savings estimete is unreilabie at this time. Use an AW analysis ot MARR= 10% per year to determine if the selection between A and B changes when the estimated savings varles as much as 140% from the best estimates, and if so, at whet percentage in the estimate? Use tabulated factors Company First cost. $ AOC, $ por year Savings best estimate, $ per year Salvage value,S Life, years 44,000 7,500 15,000 5,000 15 -35,000 8,000 (13,000 3.700 Yes O. the selection between A and 8 changes O when the estimated savings is +40% of the best estimate O
Titan manufactures and sells gas powered electricity generators, It can purchase a new fine of fuel injectors from elther of two companies: A or B. The AOCand annual savings estimates are availoble, but the savings estimete is unreilabie at this time. Use an AW analysis ot MARR= 10% per year to determine if the selection between A and B changes when the estimated savings varles as much as 140% from the best estimates, and if so, at whet percentage in the estimate? Use tabulated factors Company First cost. $ AOC, $ por year Savings best estimate, $ per year Salvage value,S Life, years 44,000 7,500 15,000 5,000 15 -35,000 8,000 (13,000 3.700 Yes O. the selection between A and 8 changes O when the estimated savings is +40% of the best estimate O
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![Titan manufactures and sells gas-powered electricity generators. It can purchase a new fine of fuel injectors from either of two
companies: A or B. The AOCand annual savings estimates are availoble, but the savings estimete is unrelabie at this time. Use an AW
analysis at MARR= 10% per year to determine if the selection between A and B changes when the estimated savings varles as much
as 240% from the best estimates, and if so, at whet percentage in the estimate? Use tabulated factors.
Company
First cost, $
ded
AOC, $ por year
44,000
7,500
15,000
5,000
-35,000
8,000
(13,000
3700
Savings best estimate, $ per year
Salvage value,S
Life, years
Yes
O. the selection between A and 8 changes O when the estimated savings is +40% of the best estimate O](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff642b06b-8f24-4abb-a5af-837dd57f4ecc%2F444a1b0d-45b0-4231-9201-f6e5e489fe8f%2F3dmg1pe_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Titan manufactures and sells gas-powered electricity generators. It can purchase a new fine of fuel injectors from either of two
companies: A or B. The AOCand annual savings estimates are availoble, but the savings estimete is unrelabie at this time. Use an AW
analysis at MARR= 10% per year to determine if the selection between A and B changes when the estimated savings varles as much
as 240% from the best estimates, and if so, at whet percentage in the estimate? Use tabulated factors.
Company
First cost, $
ded
AOC, $ por year
44,000
7,500
15,000
5,000
-35,000
8,000
(13,000
3700
Savings best estimate, $ per year
Salvage value,S
Life, years
Yes
O. the selection between A and 8 changes O when the estimated savings is +40% of the best estimate O
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