Which approach is typically employed to evaluate different options that serve the same function but have varying lifespans?

Engineering Economy MCQs for PPSC, FPSC, NTS, and Pakistan government job tests. Select an option below, then read the explanation.

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Subject
Engineering Economycivil-engineering-mcqs › engineering-economy
Published
21 Jan 2019
Last updated
28 May 2026

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Explanation

When comparing alternatives with the same objective but different durations, the annual cost method is commonly used. This technique converts costs into an equivalent uniform annual amount, facilitating a fair comparison despite unequal lifespans. Other methods like capitalized cost and present worth focus on total or present values, while MARR is a benchmark rate for investment decisions.

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