93% and costs for $1232. Although this new technology has no salvage value but it helps the factory to save much energy for upcoming 8 Years. Identify the present worth of the entire investment if the market rate is 10%.

93% and costs for $1232. Although this new technology has no salvage value but it helps the factory to save much energy for upcoming 8 Years. Identify the present worth of the entire investment if the market rate is 10%.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: The purchase price of an instrument is $12,000 and its estimated maintenance costs are $500 for the…

A: The present value of an amount of money in the future is the worth of that amount of money right…

Q: What is the book value (to the nearest cent) for the asset in year 1 if straight-line method is…

A: Answer; Given data Cost of Asset = $ 50,000 Useful Life = 6 years Salvage Value = $4,000

Q: PART B.) Decide which of the following alternatives should be selected (if one of them MUST be…

A: Introduction: Operating costs are involved with the day-to-day maintenance and management of a firm.…

Q: A company is looking at purchasing a new Zeiss CMM (precision measurement machine). They believe…

A: The rate of return on the investment is the return percentage earn on the particular amount of…

Q: Perform a present worth analysis of equal service alternatives with the costs shown below, if the…

A: Here we calculate the present worth by using the MRR and conclude the final decision , so…

Q: Economics Last year, a decision was made to keep the same equipment in lieu of buying new equipment.…

A: We are going to find the present worth for new machine if bought last year to get the equivalent…

Q: A village has 3 alternatives to choose from in replacing their existing piping system. A pump is…

A: Given information Three alternatives Alternative 1 Pump cost=3,00,000 Pipe cost=6,00,000 Annual…

Q: A new engineering graduate is considering two models of SUV's for commuting between Flint and Auburn…

A: Here we calculate the annual worth of the vehicle , by using the given information so the…

Q: A car is needed for three years. Plans A and B for acquiring the car are being evaluated. An…

A: Buying entails more monthly payments, but in the end, you own an asset—a vehicle. Lease payments, on…

Q: company can purchase a certain machine or rent one. IF purchased, the machine will cost $15,000 and…

A: Here we calculate the number of days the machine be justify its purchase by using the given…

Q: 2. Machines that have the following costs are under consideration for a robotized welding process.…

A: For Making a comparable let's take LCM of both the life and then make it equal and then calculate…

Q: Perform present worth analysis with the costs shown below to select the best altermative. The MARR…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: An oil refinery finds that it is necessary to treat the waste liquids from a new process before…

A: Given, There are two option for the treatment of waste liquids Treatment cost= $20,000 in the first…

Q: You deposit S1000 today, $3000 one year from now and $4000 two years from now. If there are…

A: here we calculate the value of i by using the given information and choose the correct option , so…

Q: stion S Ipurchased a treamury bill for ss00 and then sold it for $550 three months later, Calculate…

A: Total holding period return is the total amount received from holding assets or by any investment…

Q: The alternatives shown on the basis of their capitalized costs using an interest rate of 10% per…

A: A B First Cost, SR -100000 -800000 Annual Operation Cost -70000 -12000 Salvage value, SR…

Q: A university lab is a research contractor to NASA for in-space fuel cell systems that are hydrogen-…

A: Given MARR = 10 % time = 8 years Present worth = cashflow each year / (1 + rate)^time NPV = sum of…

Q: A new sander costs $3,600 and has an annual maintenance cost of $400. The salvage value after 7…

A: Given: The cost of a new sander is = $3,600 The annual maintenance cost is = $400 The salvage value…

Q: YOLO Construction Co. is planning to purchase a new truck Company uses MARR as 10% per year.…

A: PW is the present value of cash flows that are expected to occur in the future.

Q: PART A.) Decide which of the following machines should be selected (if one of them MUST be selected)…

A: Note:- Since you have asked multiple question, we will solve the first question for you. If you want…

Q: An asset has a first cost of $12,000, an annual operating cost of $3500 and a salvage value of $5000…

A: Given: An asset has a first cost of = $12,000 An annual operating cost of = $3,500 A salvage value…

Q: A manufacturer is considering replacing a production machine tool. The new machine, costing $3700,…

A: Given: The cost of a new machine is = $3,700 Life for new machine = 4 years Salvage value = 0…

Q: 2) Machines that have the following costs are under consideration for a robotized welding process.…

A: Since the life of the alternatives is unequal, we have to take the LCM of 3 & 5, i.e., 5 for…

Q: As a Shareholder of a Construction firm, it has been decide by the board to purchase a new 18…

A: Given information: Salvage value = 6000 Annual revenue = $24000 G = 400 Interest rate, r = 10% Time,…

Q: A machine has a cost of Php 12218.00. It has a salvage of Php 2509.00 and an economic life of 9…

A: Given Machine cost = 12218 salvage = 2509 economic life = 9 years Adjusted machine cost = 12218 -…

Q: oper

A: Given : First Cost=$17000 annual operating cost =$8000 salvage value =$5000 Life=3 years i=10%

Q: A construction firm needs a new small loader. It can be leased from the dealer for 3 years for $5500…

A: Given: Interest rate = 10% per year For Buying the loader: Initial Cost = $27,000 Salvage Value…

Q: An asset has a first cost of $11,000, an annual operating cost of 59000 and a salvage value of $5000…

A: The annual worth (AW) value for an alternative is comprised of two components: capital recovery for…

Q: Calculate the future worth (FW) at 10% of a project that will save $25K per year for 20 years. The…

A: In the future worth analysis, we find the future value of all the cash flows. In the present worth…

Q: In comparing the machines on a present worth basis, the present worth of machine X, the cost of…

A: Here we calculate the present value of machine and choose the correct option so the calculation of…

Q: Last year, a decision was made to keep the same equipment in lieu of buying new equipment. The old…

A: We are going to calculate Present Worth first to identify the EUAC to answer this question…

Q: Referring to the following cumulative cash flow diagram, salvage value is most nearly ERY $500000…

A: The term "cumulative cash flow" can be applied to both projects and businesses. A company's or…

Q: An initial capital of $25,000 was put up for a new project that will produce an annual income of…

A: The gross domestic product depends upon various factors such as investment, consumption, net exports…

Q: . Calculate the present worth of a machine which costs $80000 initially and will have a $18000…

A: Given Information Interest eate (i) = 9%Initial cost = 80000 Salvage Value = 18000Operating cost =…

Q: (a) An existing machine In a factory has an annual maintenance cost of RM 40,000. A new and more…

A: Since you have posted multiple Questions, as per guidelines we can solve only one question per…

Q: Rebecca is moving away from New York City for her new job, so she must buy a car rather than rely on…

A: Equivalent annual cost (EAC) is the annual cost of owning, operating, and maintaining an asset over…

Q: ation and maintenance will be P81,000 per year. Taxes and insurance will year. The company expects…

A: *Answer:

Q: what is the EUAC corresponding to an overhaul cost of 4000 at year 3 for a machine with 7 years of…

A: Given information Overhaul cost at 3rd year=4000 Life=7 years i=8%

Q: The International Parcel Service has installed a new radio frequency identification system to help…

A: Net present worth is a method which is used to determine the current value of the future sum of…

Q: What is the Delta IRR of the difference between the cash flow of the machine with the higher initial…

A: To find the delta IRR we take following steps - => Compute Net cash flows of both the machines .…

Q: The present worth of the cash flows through year k, PW, for a defender (three-year remaining useful…

A: We calculate Equivalent Annual Cost (EAC) = {(interest rate * NPV)/(1-(1+interest rate)^-n)}

Q: The alternatives shown on the basis of their capitalized costs using an interest rate of 10% per…

A: Two projects in can be compared in terms of finance by using their cash flows in future which would…

Q: Evaluate to total present worth of all the cash-flow of machine ABC for an interest rate of 10% per…

A: Investment Cost 18000 Annual Expences 250 Overhead Cost 7th Year 500 Overhead Cost 14th Year…

Q: D-80 The interest rate that makes Alternatives A and B equivalent is in what range?

A: The nominal interest rate can be nay declared or given rate of interest. It is also known as the…

Q: From the following alternatives based on 8% interest rate. Machine A B First Cost P5000 P10000…

A: Equivalent Annual worth = Where, P = Present value I = interest rate N = no of years Present…

Q: Lim Bon Fing Y Hermanos Inc has offered for sale its two-storey building in the commercial district…

A: * SOLUTION :- * Given that, Annual receipts = 350000 Annual expenses =…

Q: The first cost of an equipment is 65000 and a salvage value of 3000 at the end of its 6 year life.…

A: Given First cost of equipment (FC)=65000 Salvage value SV=3000 Useful life (n) =6 year We have to…

Question

Annual thermal loss through the pipe lines
of a factory is estimated to be $412 in
terms of wasted energy. A new anti-heating
technology can reduce the energy loss by
93% and costs for $1232. Although this
new technology has no salvage value but
it helps the factory to save much energy
for upcoming 8 Years. Identify the present
worth of the entire investment if the market
rate is 10%.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

A) Mary O’Leary’s company ships fine wool garments from CountyCork, Ireland. Five years ago she purchased some new automatedpacking equipment having a first cost of $125,000. The annual costsfor operating, maintenance, and insurance, as well as market valuedata for each year of the equipment’s 10-year useful life are asfollows. B) Now Mary is looking at the remaining 5 years of her investment inthis equipment. What is the marginal cost for each of the remaining5 years? When, if at all, should Mary replace this packing equipmentwith a new asset that has a minimum EUAC of $110,000?
IPS Corp. will upgrade its package-labeling machinery. It costs $850,000 to buy the machinery and have it installed. Operation and maintenance costs, which are $11,000 per year for the first 3 years, increase by $1000 per year for the machine’s 10-year life. The machinery has a salvage value of 12% of its initial cost. Interest is 25%. What is the future worth of cost of the machinery? dont use excel. dont write answer in a paper becouse of handwriting. thanks
Given the two machines data Machine A Machine B First Cost P8,000.00 P14,000.00 Salvage value 2,000.00 Annual operation 3.000.00 2,400.00 Annual maintenance 1.200.00 1,000.00 Taxes and insurance 3% 3% Life, years Money is worth at least 16%. What is the exact rate of return? 10 15
Economics A new machine can be purchasedfor$80,000. Its expecteduseful life is 5 years, at which time its market value will be $6,000. Annual revenues less expenses dueto the new machine will be $20,000 per year overthefive-year period. Assume a MARR of 10% to determine if this is a good investment by using. a) the PW method b)the FW method c) the AW method d) The IRR method e) The ERR method
3 Your company plans to raise price on product A by 5% per year. Due to competition, sales volume from product A is expected to decline at 10% per year. Revenue will be $5M for this year. Alternatively, based on the projection from the marketing department, you may reduce the sales volume decline from 10% to 5% if the price is kept unchanged. The product will be discontinued at the end of year 5 for both scenarios. If the firm's TVOM is 10%, Determine the revenue cash flow streams for both alternatives. What is the Excel financial function to compute PW of the revenue streams
Correct only pls. Only the highlighted parts. Npv if pretax cost savings are $100000 per year is -121277. 58. Now how to find the last part.
E2 A steel bridge on Louisiana state highway near the Gulf of Mexico is costing $450.000 yearlyin maintenance large chipping, priming, and painting. It originaly cost $1.600.000 when it wasbuilt 15 years ago. The Louisiana bridge engineers estimate that its remaining life is 10 years,then it will need to be replaced because of increased traffic. Its salvage value at any point intime is zero, because the cost of demolition will most like equal its value as scrap steel.A concrete bridge is considered to be the best challenger. It will cost $3.000.000 to build and$100.000 annually in maintenance costs. Its estimated life is 50 years. Its resale value may becounted as zero at any time during its life.No taxes of any kind will be considered for this government project. All costs are in constantdollars of year 0. Inflation may be ignored. Assume that annual benefits for either structure areexactly the same. A discount rate of 10 percent is to be used in analysis.(a) What is the economic life…
It is estimated that a certain piece of equipment can save $22,000 per year in labor and materials costs. The equipment has an expected life of five years and no market value. If the company must earn a 5% annual return o0.such investments, how much could be justified now for the purchase of this piece equipment? 6.
A firm is considering which of twodevices to install to reduce costs. Both devices have useful lives of 5 years and no salvage value. Device A costs $10,000 and can be expected to result in $3000 savings annually. Device B costs $13,500 and will provide cost savings of $3000 the first year but will increase $500 annually, making the second-year savings $3500, the third-year savings $4000, and so forth. For a 7% MARR, which device should the firm purchase?
Be the Bridge is a non-profit organization that anticipates the following expenditures. Year Expenditures 1 $40,000 2 $45,000 3 $80,000 4 $280,000 5 $550,000 6 $750,000 It would like to set aside money in an account today to ensure that it has enough money to cover these expenditures. How much money would Be the Bridge need to invest if its money is kept in an account that earns 10% that is compounded annually? Click here to access the TVM Factor Table calculator. $ million Carry all interim calculations to 5 decimal places and then round your final answer to three decimal places. Please enter your answer in millions of dollars. The tolerance is ±0.002.
Which process line should be built for a new chemical? The expected market for the chemical is 20 years. A 6% rate is used to evaluate new process facilities, which are compared with present worth. How much does the better choice save? Option Salvage Life 1 2 First Cost $15 M $20 M O&M Cost/Year $5 M $3 M $4 M $6 M 10 years 20 years
5- Year SV O&M 15,000 1000 12,000 1500 9,000 The table above lists salve value (SV) and operating and maintenance (O&M) cost of an asset through 3 years with the initial cost of $20,000. Given MARR is 10%, which of the statements 3 2000 is correct (choose the closest answer)? a) The marginal cost at year 2 is $6,000 and the annual cost (EUAC) through year two is $6,500 b) The marginal cost at year 2 is $6,000 and the annual cost (EUAC) through year two is $7,048 c) The marginal cost at year 2 is $6,500 and the annual cost (EUAC) through year two is $7,048 d) The marginal cost at year 2 is $6,500 and the annual cost (EUAC) through year two is $6,000