Griffith Vehicle Has Received Three Proposals for Its New Vehicle-Painting

question 62

Essay

Griffith Vehicle has received three proposals for its new vehicle-painting machine.Information on each proposal is as follows:
$$\begin{array} { | l | r | r | r | } \hline & \text { Proposal X } & \text { Proposal Y } & \text { Proposal Z } \\\hline \text { Initial investment in equipment } & \$ 240,000 & \$ 150,000 & \$ 190,000 \\\hline \text { Working capital needed } & 0 & 0 & 10,000 \\\hline \text { Annual cash saved by operations: } & & & \\\hline \text { Year 1 } & 80,000 & 50,000 & 80,000 \\\hline \text { Year 2 } & 80,000 & 42,000 & 80,000 \\\hline \text { Year 3 } & 80,000 & 46,000 & 80,000 \\\hline \text { Year 4 } & 80,000 & 24,000 & 80,000 \\\hline \text { Salvage value end of year: } & & & \\\hline \text { Year 1 } & 100,000 & 80,000 & 60,000 \\\hline \text { Year 2 } & 80,000 & 60,000 & 50,000 \\\hline \text { Year 3 } & 40,000 & 40,000 & 30,000 \\\hline \text { Year 4 } & 10,000 & 20,000 & 15,000 \\\hline \text { Working capital returned } & 0 & 0 & 10,000 \\\hline\end{array}$$ Required:
Determine each proposal's payback.

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Definitions:

Y

Typically represents the dependent variable in a mathematical equation or function, often plotted on the vertical axis in a graph.

Positive Exponents

Exponents that are greater than zero, representing multiplication of the base number by itself a specified number of times.

Expression

A combination of numbers, variables, and arithmetic operations.

Simplify

To simplify an expression means to make it as straightforward as possible by combining like terms and performing arithmetic operations.