1-)According to replacement analysis, determine the number of years that the defender should be used before replacement.DefenderChallengerYear,TCEUACTCEUACk114,000 14,000 15,000 15,000212,000 13,038 11,500 13,317Scenario313,000 13,027 14,000 13,5281414,000 13,243 14,500 13,743515,500 13,627 16,000 14,128Your answer:Use defender: 5 years than replace with the challengerUse defender: 3 years than replace with the challengerUse defender: 1 year than replace with the challengerUse defender: 0 year than replace with the challengerUse defender: 2 years than replace with the challengerUse defender: 4 years than replace with the challenger

Replacement analysis involves research into the planning, justification, and execution of a…

1-)According to replacement analysis, determine the number of years that the defender should be used before replacement. Defender Challenger Year, TC EUAC TC EUAC k 1 14,000 14,000 15,000 15,000 2 12,000 13,038 11,500 13,317 Scenario 3 13,000 13,027 14,000 13,528 1 4 14,000 13,243 14,500 13,743 5 15,500 13,627 16,000 14,128

1-)According to replacement analysis, determine the number of years that the defender should be used before replacement. Defender Challenger Year, TC EUAC TC EUAC k 1 14,000 14,000 15,000 15,000 2 12,000 13,038 11,500 13,317 Scenario 3 13,000 13,027 14,000 13,528 1 4 14,000 13,243 14,500 13,743 5 15,500 13,627 16,000 14,128

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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uppose that you purchased a HVAC system five years ago for $75, 000. The O&Mcosts are $15, 000 this year and are expected to increase by $1, 000 each year for the next five yearsthen remain the same for the following years.The current salvage value of the system is $15, 000; salvage value after one year is estimated tobe $12, 000; after two years, $11, 000; after three years, $10, 000; after four years, $9, 000; and so on.A new industrial HVAC system is available for purchase at a price of $95, 000, including instal-lation. The market value of the new system will decrease at a rate of 15% each year. The O&Mcosts are expected to be $1, 000 in the first year, and will increase at a rate of 20% each year. Themaximum service life of the new system is 10 years. Assume that your company uses an interestrate of 10% for all project evaluations.(a) Find the remaining economic life of the currently owned asset.(b) What is the economic service life of the new system?(c) Use the…
3. The chimney of the Chemical Enginering building was built 25 years ago in today's currency for 5,000,000 TL. The economic life of this chimney is estimated to be 50 years and there is no salvage value. This damaged chimney must be strengthened or demolished and rebuilt. 3,000,000 TL is required for the strengthening of the chimney and the economic life will increase 30 years as a result of the strengthening. In this case, the annual maintenance cost of the chimney is estimated to be 250,000 TL. If the chimney is rebuilt, 7,500,000 TL will be spent and its economic life will be 60 years. In this case, it is estimated that the annual maintenance cost of the chimney will be 100,000 TL and there will be no salvage value. It is estimated that the demolishment expenses of the old chimney will be 500,000 TL. If interest rate is 20%, as a Chemical Engineer, what kind of decision would you recommend the university to take regarding the chimney of the building?
A company is looking to install a new automated system to increase its revenues by $24,000 per year over the next five years. Annual expanses of the system are expected to be $3,400. The system will cost $80,000 and have $5,000 salvage value at the end of the fifth year. If the MARR is 10%, what is the Annual Worth (AW). Select one: O a. $215 O b. $115 O C. $315 O d. $415
Rerform an EAC analysis and evaluate what decision to make regarding 2 challengers and 1 defender. Elaborate:a) Graphsb) EAC analysisc) Conclude the exercise and make a decision regarding the results Machine N1 (#1 challenger) useful life = 8 years Initial Cost $15,000 MARR 18% Year Operating costs Market value EAC 1 $ 355.00 $ 8,000.00 2 $ 500.00 $ 7,000.00 3 $ 788.00 $ 6,000.00 4 $ 1,000.00 $ 5,000.00 5 $ 1,355.00 $ 4,000.00 6 $ 1,688.00 $ 3,000.00 7 $ 2,012.00 $ 1,000.00 8 $ 2,345.00 $ 0.00
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You have been asked to perform a sensitivity analysis on a plant modernization plan. The initial investment is $30,000. Expected annual savings is $13,000. Salvage value is $7,000 after a 7 year planning horizon. The MARR is 12%. Determine the AW if the annual savings change by the following percentages from the initial estimate: b. -80%c. -60%d. -40%e. -20%f. +20%g. +40%h. Determine the percentage change in net annual savings that causes a reversal in the decision regarding the attractiveness of the project
The following tables show the marginal costs of a defender over its remaining four years of service life. If the challenger's minimum EUAC is $29,403, what is the most appropriate replacement decision? Year 1234 Marginal cost $31,053 $26,353 $28,003 $32,803 ○ A. No decision can be made unless additional calculations are made on the challenger B. Replace the defender now OC. No decision can be made unless additional calculations are made on the defender ○ D. Keep the defender for at least one more year
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