As energy costs continue to rise, power efficiency is increasingly important. Acme Chemical is evaluating two different electric motors to
drive a mixing motor and needs to perform a present economy study. The motor will produce 75 hp and will be operated eight hours per day,
365 days for one year (maintenance will be performed on second shift- assume no down time during operation), after which time the motor will
have no value. Select the most economical motor. Assume Acme's electric power costs $0.16 per kWh. 1 hp = 0.746 kW. Motor A Motor B
Purchase price $3,200 $3,900
Annual maintenance cost $250 $450
Efficiency 75% 85%