16. The investment cost of a new equipment is P 50,000 and this equipment will havea market value of P 15,000 at the end of five years. What is the present worth ofthis market value if the company's MARR is 18 % per year?17. The initial cost of the new pump system is P 3,500 and has a salvage value of P 500and costs P 1.50 per hour to operate. The system has an estimated service life of10 years and operate 800 hours per year. Assume that the company has a MARRof 12% for this project. Is the project a good investment using the approximatepresent worth of the pump system over the first 10 years of operation?

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16. The investment cost of a new equipment is P 50,000 and this equipment will have a market value of P 15,000 at the end of five years. What is the present worth of this market value if the company's MARR is 18 % per year?

16. The investment cost of a new equipment is P 50,000 and this equipment will have a market value of P 15,000 at the end of five years. What is the present worth of this market value if the company's MARR is 18 % per year?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

16. The investment cost of a new equipment is P 50,000 and this equipment will have
a market value of P 15,000 at the end of five years. What is the present worth of
this market value if the company's MARR is 18 % per year?
17. The initial cost of the new pump system is P 3,500 and has a salvage value of P 500
and costs P 1.50 per hour to operate. The system has an estimated service life of
10 years and operate 800 hours per year. Assume that the company has a MARR
of 12% for this project. Is the project a good investment using the approximate
present worth of the pump system over the first 10 years of operation?

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