Problem 1 Make-to-Specs is a software system under development by ABC Corporation. It will be able to translate digital

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Problem 1 Make To Specs Is A Software System Under Development By Abc Corporation It Will Be Able To Translate Digital 1 (81.35 KiB) Viewed 60 times

Problem 1 Make-to-Specs is a software system under development by ABC Corporation. It will be able to translate digital versions of three-dimensional computer models, containing a wide variety of part shapes with machined and highly finished (ultra-smooth) surfaces. The product of the system is the numerically controlled (NC) machine code for the part's manufac- turing. Additionally, Make-to-Specs will build the code for superfine finishing of surfaces with continuous control of the finishing machines. There are two alternative computers that can provide the server function for the software interfaces and shared databased updates on the manufacturing floor while Make-to-Specs is operating in parallel mode. The server first cost and estimated contribution to annual net cash flow are summarized below. First cost, $ Net cash flow, $/year Server 1 Server 2 100,000 200,000 50,000 year 1, in- 35,000 creasing by 5000 per year 4 8 Life, years (a) If the MARR = 12%, using an AW analysis, which server should be selected? (b) Using an incremental ROR analysis, which server should be selected at an MARR 12%? (c) Using an incremental ROR analysis, if Server 2 had a life of 5 years, at what MARR does Server 2 become the more attractive option?