4. Ashley Furniture needs a new grinder. Compute the present worth for these mutuallyexclusive alternatives. i= 6%. Ashley uses a 10-year planning horizon.AlternativeInitial CostAnnual CostSalvage ValueLifeA$4500$300$5005 yearsB$5500$400$010 years

The objective of this question is to calculate the present worth of two mutually exclusive…

Answered: 4. Ashley Furniture needs a new…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

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
9. Margaret has a project with a $28 000 first cost that returns $5000 per year over its 10-year life. It has a salvage value of $3000 at the end of 10 years. If the MARRis 15 percent, whatis the annual worth of this project?
Plz, solve this question Economic Engineering There are two alternatives for purchasing a concrete mixer. Both the alternatives have same useful life. The cash flow details of alternative are as follows; Alternative 1: Initial Purchase Cost= Rs3,00,000, annual operating and maintenance cost = Rs20,000, Annual revenue= Rs50000, Expected salvage value = Rs125,000; useful life = 5 years. Alternative 2: Initial Purchase Cost = Rs2,00,000, annual operating and maintenance cost = Rs35,000, Annual revenue= Rs45000, Expected salvage value = Rs70,000, useful life = 5 years. Use Present Worth method to evaluate the alternatives and recommend the best option, if the rate of interest is 10% per year
A corporation uses a type of motor truck which costs P 250,000, with life of 2 years and final salvage value P 40,000. If money is worth 4% and using the annual cost method, what should be the life, in years, of another type of truck for the same purpose whose that cost P 312,614 with final salvage value P 50,000? Select one: a. 2.5 b. 4 c. 3.5 d. 3
Given the data below for two alternatives, find the better alternative using incremental IRR if MARR is 15%. Alternatives can be replaced at the end of their useful lives. Alt. A Alt. B Initial Cost $10,000 $25,000 Maintenance Cost / Year 1500 1200 Uniform Annual Benefit 4800 12000 Salvage Value 1600 5000 Life 12 Years 8 Years
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
7) Margaret has a project with a $28 000 first cost that returns $5000 per year over its 10-year life. It has a salvage value of $3000 at the end of 10 years. If the MARR is 15 percent, what is the present worth of this project?
QZY, Inc. is evaluating new widget machines offered by three companies. The chosen machine will be used for 3 years. a) Construct a choice table for interest rates from 0% to 100%. B) MARR = 15%. From which company if any should you buy the widget machine? Use rate of return analysis. A B C First cost $15,000 $25,000 $20,000 Maintenance and operating 1,600 400 900 Annual benefits 8,000 13,000 9,000 Salvage value 3,000 6,000 4,500 a) Construct a choice table for interest rates from 0% to 100% b) MARR = 15%. From which company if any should you buy the widget machine? Use rate of return analysis
FIRST COST ANNUAL COST SALVAGE VALUE ANNUAL INTEREST RATE STUDY PERIOD Power Line 20,000 1,950.90/month × 12= 23,410.8/year Solar 25,000 X 7= 125,000+10,000= 135,000 3,000/year 0 3.5% 25 ALTERNATIVE A: A solar panel costs 25,000. 7 solar panels are needed in a company. The installation fee is 10,000 and will have a useful 25 years with no salvage value. The maintenance per year is 5,000. The annual interest rate for solar panel is 1.5%. 0 1.5% 25 ALTERNATIVE B: A new power line will cost 20,000, with power costs expected to be 1,950.90 per month. The annual increase rate of electric bill is about 3.5%. Which alternative should be selected on the basis of a future worth analysis? Illustrate the cash flow diagram. USE MS EXCEL IN COMPUTATION and SHOW THE SOLUTION PROPERLY.
Need answers ASAP... The annual worth can be calculated from the alternative’s: a. either ( a) or ( b) b. future worth by multiplying by ( F/A, i, n) c. all of the above d. present worth by multiplying by ( A/P, i, n)

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Managerial Economics: A Problem Solving Approach

Economics

ISBN:

9781337106665

Author:

Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:

Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-…

Economics

ISBN:

9781259290619

Author:

Michael Baye, Jeff Prince

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS

4. Ashley Furniture needs a new grinder. Compute the present worth for these mutually exclusive alternatives. i= 6%. Ashley uses a 10-year planning horizon. Alternative Initial Cost Annual Cost Salvage Value Life A $4500 $300 $500 5 years B $5500 $400 $0 10 years