Determine the better of the given two options

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Reference no: EM13882017

A manufacturer of hydraulic equipment is trying to determine whether it should use monofl ange double block and bleed (DBB) valves or a multi-valve system (MVS) for chemical injection. The costs are shown below. Use an AW-based rate of return analysis and a MARR of 18% per year to determine the better of the two options.

 

DBB

MVS

First cost, $

40,000

71,000

Annual cost, $ per year

60,000

65,000

Salvage value, $

0

18,000

Life, years

2

4

Reference no: EM13882017

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