A company is considering the purchase of a new machine. The machine will cost $14,000, will...

A company is considering the purchase of a new machine. The machine will cost $14,000, will result in an annual savings of $1750 with a salvage value of $500 at the end of 12 years. For a MARR of 7%, what is the benefit to cost ratio?

Question options:

	0.63
	8.25
	1.36
	1.01

Solutions

Expert Solution

Required B/C ratio = PV / Initial cost

= $14,121.69 / $14,000

= 1.008

= 1.01

Rahul Sunny answered 1 year ago

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