Present value analysis, Using present value analysis which

Present value analysis

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Reference no: EM131807231

A new alloy can be produced by Process A, which costs $200,000 to implement. The operating cost will be $10,000 per quarter with a salvage value of $25,000 after its 2-year life. Process B will have a first cost of $250,000, an operating cost of $15,000 per quarter, and a $40,000 salvage value after its 4-year life. The interest rate is 8% per year compounded quarterly. Using present value analysis which process should be selected. Contributed by Hamed Kashani, Saeid Sadri, and Baabak Ashuri, Georgia Institute of Technology.

Reference no: EM131807231

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Present value analysis : Using present value analysis which process should be selected. Contributed by Hamed Kashani, Saeid Sadri, and Baabak Ashuri, Georgia Institute of Technology.

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