Reference no: EM132662260

A construction equipment for Tech Builders Inc has a first cost of $25,000 and the following salvage values and annual operating costs:

t       S (t)             Op. cost (t)
1 $22,000          $10,000
2 $21,500          $10,500
3 $20,000          $11,000
4 $19,500           $11,500
5 $10,000            $12,000
6 0                       $12,500

Problem 1: Use a MARR of 10% and determine the EAC of keeping the equipment for all possible years and determine the optimal economic life of the equipment.