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Business, 14.04.2020 18:39 hetdashadia123

Two insulation thickness alternatives have been proposed for a process steam line subject to severe weather conditions. One alternative must be selected. Estimated savings in heat loss and installation costs are given below.

A B
Thickness 5 cm 2 cm
Installed Cost $40,000 $20,000
Annual Savings $7,500 $5,000
Life 6 years 4 years

Which thickness would you recommend for a MARR = 15% per year and negligible market (salvage) values? The study period is 12 years.

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