The range of estimates using present worth analysis

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An equiptment alternative is being economically elavuated by three engineers at a consulting firm. The first cost will be $77k and the life is estimated at 6 years with a salvage value of 10k. The engineers disagree on the estimated revenue the equiptment will generate. Joe has made an estimate of $10k per year. Jane has made an estimate of $14k per year and Carlos estmates $18k per year. The before tax MARR is 8% per year.

a) What is the minimum amount of revenue per year that would be required to breakeven?

b) What are the range of estimates using Present Worth analysis?

Reference no: EM131339672

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