Subcontracted or the labs can purchase new equipment

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Ned Thompson Labs performs tests on super alloys, titanium, aluminium, and most metals. Tests on metal composites that rely upon scanning electron microscope results can be subcontracted or the labs can purchase new equipment. Evaluate the sensitivity of the economic decision to purchase the equipment over a range of + 10% (in 10% increments) of the estimates for P, AOC, and S. Which parameter is most sensitive and why? First cost, P = $180, 000; Salvage, S=$20, 000; Life, n= 4 years; Annual operating cost, AOC = $30, 000 per year; Annual revenue. R = $70, 000 per year; MARR = 10% per year

Reference no: EM131205541

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