A coal-fired power plant has upgraded an emission control valve. The modification costs only $5,000 and is expected to last 7 years. The maintenance cost is expected to be high at $2000 the first year, increasing by 11% per year thereafter. Determine the equivalent present worth of the modification and maintenance cost by hand at 11% per year.
A coal-fired power plant has upgraded an emission control valve. The modification costs only $5,000 and is expected to last 7 years. The maintenance cost is expected to be high at $2000 the first year, increasing by 11% per year thereafter. Determine the equivalent present worth of the modification and maintenance cost by hand at 11% per year.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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1
![A coal-fired power plant has upgraded an emission control valve. The modification costs only $5,000 and is
expected to last 7 years. The maintenance cost is expected to be high at $2000 the first year, increasing by 11%
per year thereafter. Determine the equivalent present worth of the modification and maintenance cost by hand
at 11% per year.
Answer:
î PoTotal
$ 2K
$ 2K(1.11)
$ 2K(1.11)2
$ 2K(1.11)
$ 5K
$ 2K(1.11)*
$ 2K(1.11)5
$ 2K(1.11)6
Answer:
w = Blank 1
POTotal = $ Blank 2
FTTotal / POTotal = $ Blank 3
A/ POTotal = S Blank 4
Note: Do not round in between solution. No need to put UOM and comma. Final answer round to the nearest WHOLE NUMBER.
Blank 1
Add your answer
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Transcribed Image Text:A coal-fired power plant has upgraded an emission control valve. The modification costs only $5,000 and is
expected to last 7 years. The maintenance cost is expected to be high at $2000 the first year, increasing by 11%
per year thereafter. Determine the equivalent present worth of the modification and maintenance cost by hand
at 11% per year.
Answer:
î PoTotal
$ 2K
$ 2K(1.11)
$ 2K(1.11)2
$ 2K(1.11)
$ 5K
$ 2K(1.11)*
$ 2K(1.11)5
$ 2K(1.11)6
Answer:
w = Blank 1
POTotal = $ Blank 2
FTTotal / POTotal = $ Blank 3
A/ POTotal = S Blank 4
Note: Do not round in between solution. No need to put UOM and comma. Final answer round to the nearest WHOLE NUMBER.
Blank 1
Add your answer
Blank 2
Add your answer
Blank 3
Add your answer
Blank 4
Add your answer
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