What is the equivalent annual worth of the autoclave

Reference no: EM131506712

Question: A health services firm is thinking about purchasing a large autoclave for $180,000. The autoclave is expected to generate $60,000 in its first year of operation. This amount will increase by 5% per year (so it would be $63,000 in year 2). Furthermore, the autoclave has a useful life of 8 years and an expected annual usage of 2,000 hours. Its salvage (market) value at the end of year 8 will be 10% of the initial investment. What is the equivalent annual worth of the autoclave, per hour of utilization, if the firm's MARR is 8% per year?

Reference no: EM131506712

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