Generate an annual benefit

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An product has an initial cost of $130,000 and an estimated salvage value of $35,000 after its 7- year service life. Estimated O&M costs are $45,000 in year one, increasing by $5,000 per year thereafter. The product is expected to generate an annual benefit of $90,000. Is this a desirable investment if the MARR is 25%? Hand solution please with formula

Reference no: EM133134307

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