AB-Crystallography is also studying options regarding an existing spectrometer whose workload will soon be exceeded. That spectrometer has a salvage value today of $15k. Operating and maintenance costs on it run $2k/year and it has an estimated end-of-life salvage value of $4k. One option is to keep the existing spectrometer for its remaining service life of 4 years and supplement it with a new small spectrometer that cost $10k has operating and maintenance costs of $3k annually a service life of 6 years and a final salvage value of $3k. The second option is to dispose of the current spectrometer and subcontract that work at a cost of $9.5k/yr. Using a study period of 4 years and a MARR of 14% which option should be selected? AB-Crystallography is also studying options regarding an existing spectrometer whose workload will soon be exceeded. That spectrometer has a salvage value today of $15k. Operating and maintenance costs on it run $2k/year and it has an estimated end-of-life salvage value of $4k. One option is to keep the existing spectrometer for its remaining service life of 4 years and supplement it with a new small spectrometer that cost $10k has operating and maintenance costs of $3k annually a service life of 6 years and a final salvage value of $3k. The second option is to dispose of the current spectrometer and subcontract that work at a cost of $9.5k/yr. Using a study period of 4 years and a MARR of 14% which option should be selected?
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