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Question: A machine shop estimates they can decrease cost by $20,000 per year if they use a CNC 1 machine w...

Show transcribed image text A machine shop estimates they can decrease cost by $20,000 per year if they use a CNC 1 machine worth $200,000 with a useful life of 15 years. Do the savings alone justify the investment, if the shop has a MARR = 12%? If the machine shop estimates CNC 1 would also decrease maintenance costs by $5,000 the first year, and continue decreasing them by $100 every year after, do the additional savings justify the investment?

A machine shop estimates they can decrease cost by $20,000 per year if they use a CNC 1 machine worth $200,000 with a useful life of 15 years. Do the savings alone justify the investment, if the shop has a MARR = 12%? If the machine shop estimates CNC 1 would also decrease maintenance costs by $5,000 the first year, and continue decreasing them by $100 every year after, do the additional savings justify the investment?