Four mutually exclusive alternatives are being evaluated, and their costs and revenues are itemized as follows:
1 2 3 4
Capital Investment $100,000 $152,000 $184,000 $220,000 Annual revenues less expenses $15,200 $31,900 $35,900 $41,500 Market value (end of useful life) $10,000 $0 $15,000 $20,000 Useful life (years) 12 12 12 12
If the MARR is 15% per year and the analysis period is 12 years, use the Present Worth method to determine which alternatives are economically acceptable and which one should be selected. If the total capital investment budget available is $200,000, which alternative should be selected?