Engineering Economy 7th Edition by Leland Blank ,Anthony Tarquin

Exercise 11

An industrial engineer is considering two robots for purchase by a fiber-optic manufacturing company. Robot X will have a first cost of $80,000, an annual maintenance and operation (M O) cost of $30,000, and a $40,000 salvage value. Robot Y will have a first cost of $97,000, an annual M O cost of $27,000, and a $50,000 salvage value. Which should be selected on the basis of a future worth comparison at an interest rate of 15% per year Use a 3-year study period.