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Business, 16.10.2020 14:01 morganashley6795

A retrofitted space-heating system is being considered for a small office building. The system can be purchased and installed for $125,000, and it will save an estimated 250,000 kilowatt-hours (kWh) of electric power each year over a five-year period. A kilowatt-hour of electricity costs $0.09, and the company uses a MARR of 15% per year in its economic evaluations of refurbished systems. The market value of the system will be $7,000 at the end of five years, and additional annual operating and maintenance expenses are negligible. Required:
Use the benefit-cost method to make a recommendation.

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