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1. The manager of engineering at the 900-megawatt Hamilton Nuclear Power Plant has three options to supply personal safety equipment to employees. Two are vendors who sell the items, and a third will rent the equipment for $50,000 per year, but for no more than 3 years per contract. These items have relatively short lives due to constant use. The MARR is 10% per year. Vendor R Vendor T Rental Initial cost, $ -75,000 -125,000 Annual upkeep cost, $/year -27,000 -12,000 Annual rentalcost, $ per year -50,000 Salvage value, $ 30,000 Estimated life, 3 Maximum years of 3

1. The manager of engineering at the 900-megawatt Hamilton Nuclear Power Plant has three options to supply personal safety equipment to employees. Two are vendors who sell the items, and a third will rent the equipment for $50,000 per year, but for no more than 3 years per contract. These items have relatively short lives due to constant use. The MARR is 10% per year. Vendor R Vendor T Rental Initial cost, $ -75,000 -125,000 Annual upkeep cost, $/year -27,000 -12,000 Annual rentalcost, $ per year -50,000 Salvage value, $ 30,000 Estimated life, 3 Maximum years of 3

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Draw cash flow diagrams with symbols. Show your work using conversion factor notations. You need actual calculations to make a decision 1. The manager of engineering at the 900-megawatt Hamilton Nuclear Power Plant has three options to supply personal safety equipment to employees. Two are vendors who sell the items, and a third will rent the equipment for $50,000 per year, but for no more than 3 years per contract. These items have relatively short lives due to constant use. The MARR is 10% per year. Vendor R Vendor T Rental Initial cost, $ -75,000 -125,000 Annual upkeep cost, $/year -27,000 -12,000 Annual rentalcost, $ per year -50,000 Salvage value, $ 30,000 Estimated life, 2 3 Maximum years of 3
Transcribed Image Text:Draw cash flow diagrams with symbols. Show your work using conversion factor notations. You need actual calculations to make a decision 1. The manager of engineering at the 900-megawatt Hamilton Nuclear Power Plant has three options to supply personal safety equipment to employees. Two are vendors who sell the items, and a third will rent the equipment for $50,000 per year, but for no more than 3 years per contract. These items have relatively short lives due to constant use. The MARR is 10% per year. Vendor R Vendor T Rental Initial cost, $ -75,000 -125,000 Annual upkeep cost, $/year -27,000 -12,000 Annual rentalcost, $ per year -50,000 Salvage value, $ 30,000 Estimated life, 2 3 Maximum years of 3
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