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An electric switch manufacturing company has to choose one of the three different assembly methods. Method...

An electric switch manufacturing company has to choose one of the three different assembly methods. Method A will have a first cost of $40,000, an annual operating cost of $9000, and a service life of 2 years. Method B will cost $80,000 to buy and will have an annual operating cost of $6000 over its 4-year service life. Method C will cost $130,000 initially with an annual operating cost of $4000 over its 8-year life. Methods A and B will have no salvage value, but method C will have some equipment worth an estimated $12,000. Which method should be selected? Use present worth analysis at an interest rate of 10% per year.

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