Scientific Instruments, Inc. uses a MARR of 8% per year. The company is evaluating a new process to reduce water effluents from its manufacturing processes. The estimate associated with the process follows.
New Process:
First Cost, $ -40,000
NCF, $ per year 13,000
Salvage value, $ 5000
Life, years 3
In evaluating the process on the basis of a rate of return analysis, the correct equation to use is:
Select one:
O a. 0=-40,000( F/P,i,3) + 13,000( F/A,i, 3)+5000
O b. 0=-40,000+ 13,000( P/A, 1,3) + 5000( P/F, i 3)
O c 0=-40,000( A/P,i,3) + 13,000+ 5000(A/F, i,3)
O d. Any of the answers are correct