Find the cost of the best alternative


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Q: Designers need to decide how to condition the air in new building with 40-year life. Two alternatives are available. both of which have 20-year lives. Costs are given below. Use 12% interest to find the best alternative. A small building can be reroofed for $6000 (aluminum) or $3500 (shingles). The estimated lives are 50 year and 15 years, respectively. If the interest rate is 10%, which alternative is superior?

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Accounting Basics: Find the cost of the best alternative
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