Considering which of two devices to install to reduce costs

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Reference no: EM131867997

A company is considering which of two devices to install to reduce costs. Both devices have service life of 5 years with no salvage value. Device X costs $10,000 and can be expected to result in $3,000 saving annually. Device Y cost $13,500 and will provide cost savings of $3,000 in the first year but increase $500 annually thereafter. At a MARR of 7%, which device should be purchased using ROR analysis?

Reference no: EM131867997

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