If these alternatives were directly

compared, we would want to choose the

one with the largest net present value, the
Sabre model.
However, these projects have different
useful lives, and therefore they are not
perfectly compared. We will try the EA
comparison.
EA
!E"
# $%&
!E"
' Annuity (actor
# !)*+,,-+,+.+ " ' !,./,01"
# ) *12+,/+1.0.
EA
!S"
# $%&
!S"
' Annuity (actor
# !)*+,0+0,.3, " ' !3./042"
# ) *120,32...3
5hus choosing the Sabre model means an
EA of ) *120,32...3, while the Eclipse
model6s EA is ) *12+,/+1.0.. Since the
Sabre model provide the conveyor services
at a lower EA, 5emleton should choose it
over the Eclipse model.