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Learning Objectives
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Formulating alternatives
Identify mutually exclusive and independent projects, and define a service and a revenue alternative.
PW of equal-life alternatives
Select the best of equal-life alternatives using present worth analysis.
PW of different-life alternatives
Select the best of different-life alternatives using present worth analysis.
FW analysis
Select the best alternative using future worth analysis.
Capitalized cost (CC)
Select the best alternative using capitalized cost calculations.
Payback period
Determine the payback period at i = 0% and i > 0%, and state the shortcomings of payback analysis.
Life-cycle cost (LCC)
Perform a life-cycle cost analysis for the acquisition and operations phases of a (system) alternative.
PW of bonds
Calculate the present worth of a bond investment.
Spreadsheets
Develop spreadsheets that use PW analysis and its extensions, including payback period.







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