Economic Life

 

1.a.

The table below shows the operating cost and salvage value for a machine for a three-year period.

Find the economic life of the machine. The machine has an initial cost of $50,000. The MARR for this analysis is 10%.

 Year

 Operating Cost

 Salvage Value

 1

$10,000

0

2

$40,000

0

3

$70,000

0


1.b. The table below shows the operating cost and salvage value for a machine for a three-year period.
Find the economic life of the machine. The machine has an initial cost of $50,000. The MARR for this analysis is 10%.

 Year

 Operating Cost

 Salvage Value

 1

$10,000

$30,000

2

$10,000

$20,000

3

$10,000

0