Engineer should be willing to pay to switch the new bulb

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Reference no: EM131453879

A plant engineer wishes to know which of two types of lightbulbs should be used to light a warehouse. The bulbs currently used cost $45.90 per bulb and last 14, 600 hours before burning out. The new bulb ($60 per bulb) provides the same amount of light and consumes the same amount of energy but lasts twice as long. The labor cost to change a bulb is $16.00. The lights are on 19 hours a day, 365 days a year. If the firm's MARR is 15%, what is the maximum price (per bulb) the engineer should be willing to pay to switch the new bulb? Assume that the firm's marginal tax rate is 40%.

Reference no: EM131453879

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