A company purchased a machine last year for $150,000. Revenue for the first year was $50,000. Over the total estimated life of 8 years, estimate the remaining equivalent annual revenues (years 2 through 8) to ensure breakeven by recovering the investment and a return of 10.356% per year, compounded daily. Costs are expected to be constant at $42,000 per year and a salvage value of $10,000 is anticipated. (Use the MARR to 3 decimal places. Format: 00.000%). dollars.

A company purchased a machine last year for $150,000. Revenue for the first year was $50,000. Over the total estimated life of 8 years, estimate the remaining equivalent annual revenues (years 2 through 8) to ensure breakeven by recovering the investment and a return of 10.356% per year, compounded daily. Costs are expected to be constant at $42,000 per year and a salvage value of $10,000 is anticipated. (Use the MARR to 3 decimal places. Format: 00.000%). dollars.

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

A company purchased a machine last year for $150,000. Revenue for the first year was $50,000. Over the total estimated life of 8
years, estimate the remaining equivalent annual revenues (years 2 through 8) to ensure breakeven by recovering the investment and a
return of 10.356% per year, compounded daily. Costs are expected to be constant at $42,000 per year and a salvage value of $10,000
is anticipated. (Use the MARR to 3 decimal places. Format: 00.000%).
dollars.

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