4. Using Benefit-cost ratio, find out the best alternative for i=10% and n=30 years. Capital Investment $ 4,250,000 $ 5,000,000 $ Annual Operating and Maintenance Cost Market Value Annual Benefit $ SASSA $ $ 375,000 625,000 1,075,000 $ GAGAGA $ $ 362,500 $ 875,000 $ 1,132,500 $ 6,000,000 350,000 1,000,000 1,250,000

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Handwritten work only, #3 & 4 pls
Practice Problems
1
You would like to buy a Car. You can pay $3000/year for 10 years. How much total you
will be paying at the end of year 10 with an interest rate of 7%?
2.
An engineer deposits $1000 in a savings account at the end of each year. If the bank pays
interest at the rate of 6%, how much fund will have accumulated in the account after 5
years? Show the cash flow diagram.
3.
A homeowner is considering whether to invest in solar panels. She has gathered the
following information for her town:
• The average cost for residential energy is $0.124/kWh.
• The government subsidizes 60% of whatever is invested by the household.
• Each square foot of panel produces 19.13 kWh every year.
• The cost of installation per square foot of solar panel is $93.91.
for
• The house has 900 square feet of roof space. What is the breakeven point in yew
the installation of solar panels? Assume the homeowner's interest rate is 6% per year.
4. Using Benefit-cost ratio, find out the best alternative for i=10% and n=30 years.
Capital Investment
$
4,250,000
$
5,000,000 $
Annual Operating and
Maintenance Cost
Market Value
Annual Benefit
$
$
$
375,000
$
625,000
$
1,075,000 $
362,500
$
875,000 $
1,132,500 $
6,000,000
350,000
1,000,000
1,250,000
5. One student would like to open a real estate farm. If he is able to pay $10,576,923 per
year for 26 years with an interest rate of 5%, how much money should he borrow?
FERN
Transcribed Image Text:Practice Problems 1 You would like to buy a Car. You can pay $3000/year for 10 years. How much total you will be paying at the end of year 10 with an interest rate of 7%? 2. An engineer deposits $1000 in a savings account at the end of each year. If the bank pays interest at the rate of 6%, how much fund will have accumulated in the account after 5 years? Show the cash flow diagram. 3. A homeowner is considering whether to invest in solar panels. She has gathered the following information for her town: • The average cost for residential energy is $0.124/kWh. • The government subsidizes 60% of whatever is invested by the household. • Each square foot of panel produces 19.13 kWh every year. • The cost of installation per square foot of solar panel is $93.91. for • The house has 900 square feet of roof space. What is the breakeven point in yew the installation of solar panels? Assume the homeowner's interest rate is 6% per year. 4. Using Benefit-cost ratio, find out the best alternative for i=10% and n=30 years. Capital Investment $ 4,250,000 $ 5,000,000 $ Annual Operating and Maintenance Cost Market Value Annual Benefit $ $ $ 375,000 $ 625,000 $ 1,075,000 $ 362,500 $ 875,000 $ 1,132,500 $ 6,000,000 350,000 1,000,000 1,250,000 5. One student would like to open a real estate farm. If he is able to pay $10,576,923 per year for 26 years with an interest rate of 5%, how much money should he borrow? FERN
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