in order to continue the operation of a small chemical plant at the same capacity. it will be…

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in order to continue the operation of a small chemical plant at the same capacity. it will be necessary to make changes on one of the reactors in the system. the decision has been made by managementthat the unit must continue in service for the next 12 years and the company policy is that no unnecessary investments are made unless at least an 8 percent rate of return (end-ofyear compounding) can be obtained. two possible ways or making a satisfactory change in the reactor are as follows:(1) make all the critical changes now at a cost of $ 5800 so the reactor will be satisfactory to use for 12 years

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