Company is considering the purchase of major capital asset

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Reference no: EM131528007

A company is considering the purchase of a major capital asset. Below is the economic data for the two assets. The annual investment rate is 10%, compounded semi-annually. Using Equivalent Uniform Annual Worth analysis, which asset is the more attractive? Options are:

1. Capitol Cost $170,000 Expected Annual Income $76000 Expected Annual Costs $49500 Life 20 years

2. Capital Cost $120,000 Expected Annual Income $59,200 Expected Annual Costs $32,400 Life 10 years

Reference no: EM131528007

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