Two systems are being considered for water purification

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Two systems are being considered for water purification. System 1 has an initial cost of $100,000, annual expenses of $25,000 and a salvage value of $5,000 at the end of its expected life of 5 years. The System 2 has an initial cost of $150,000, annual expenses of $40,000, and a salvage value of $10,000 at the end of its expected life of 10 years. If the study period is 10 years and the MARR is 20% per year, which system should be selected?

Reference no: EM131186342

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