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What is kiwidale marr that makes the two alternatives

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Kiwidale Dairy is considering purchasing a new ice-cream maker. Two models, Smoothie and Creamy, are available and their information is given below. (perform all calculation using 5 significant figures, and give your final answer to 1 decimal place).

Problem (a) What is Kiwidale's MARR that makes the two alternatives equivalent? Use a present worth comparison.

                                Smoothie                 Creamie

First Cost                15,000                 37,000
Service Life              12 years           12 years
Annual Profit                  4,400          11,200
Annual operating cost     1,600               3,820
Salvage value             2,250                 5,200

Problem (b) A MARR which makes the two alternatives equivalent in term of PW is

Reference no: EM132674152

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