9. A plant engineer is considering the two types of solar water heating system given in the table below. The firm's MARR is 12%. On the basis of the IRR criterion, which system is the better choice? "Do nothing" is not an option. 14 Click the icon to view the relevant data for the projects. The IRR on incremental investment is %. (Round to one decimal place.) Which system is the better choice? Choose the correct answer below. O Project A O Project B 14: More Info Project A Project B Initial cost $8,000 $12,000 Annual savings $900 $1,100 Annual $150 $100 maintenance Expected life 20 years 20 years Salvage value $500 $600

9. A plant engineer is considering the two types of solar water heating system given in the table below. The firm's MARR is 12%. On the basis of the IRR criterion, which system is the better choice? "Do nothing" is not an option. 14 Click the icon to view the relevant data for the projects. The IRR on incremental investment is %. (Round to one decimal place.) Which system is the better choice? Choose the correct answer below. O Project A O Project B 14: More Info Project A Project B Initial cost $8,000 $12,000 Annual savings $900 $1,100 Annual $150 $100 maintenance Expected life 20 years 20 years Salvage value $500 $600

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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2. 3. Problem 7) Given the cash flow diagram, determine the unknown for an interest rate of 10% 500 400 300 200 100 111111 4 5 6 7 8| 6.
4
Your company is determing whether or not it should invest in a new pallet wrapping station. The station would cost $6,500 and your company's MARR is 13%. You estimate the purchasing a pallet wrapper would save you $2,000 in labor annually, and at the end of 3 years you would realize a salvage value of $400. How would you calculate the present worth of this investment in Excel?
1. Consider a wine dealer who has k bottles of wine. The dealer can sell them now (t = 0) or can store it for some time and then sell them later. The value of k bottles at t-th month is given by: Vt = ket The dealer can use the sales revenue as principal in a risk-free investment at rate r. (b) Write out the present value PV, of k bottles at t-th month.
8. (10%) Two pumps are being considered for service in Africa. Each can draw water from a depth of 50 meters and both pumps deliver 60 horsepower (output) to the pumping operation. One of the pumps must be selected. It is expected that the pump will be in use 800 hours per year and electricity costs $0.14 per kilowatt-hour. The following data are available. Recall that 1 hp = 0.746 kW. Capital investment Electrical efficiency Annual maintenance cost Useful life Pump A $2,400 0.92 $320 3 years Pump B $2,000 0.80 $200 6 years The MARR is 15% per year. Determine which alternative should be selected if the repeatability assumption applies.
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