Engineering Economy, 5/e

Leland Blank, Texas A&M University
Anthony Tarquin, University of Texas - El Paso

Annual Worth Analysis

Learning Objectives

Purpose: Make annual worth calculations and compare alternatives using the annual worth method.

This chapter will help you:

Demonstrate that AW needs to be calculated over only one life cycle.

Calculate capital recovery (CR) and AW using two methods.

Select the best alternative on the basis of an AW analysis.

Calculate the AW of a permanent investment.

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