A machine that have the following costs is under consideration for a new manufacturing process. Compute the Equivalent Annual Worth with an interest rate of 8%, compounded semiannually. The machine last 8 years. First cost: $60,000 Semiannual Operating cost: $6,000 Semiannual incomes: $14,000 Salvage value $10,000 a. EAW = $2,285 Ob. EAW = $3,310 OC. EAW = $ 21,745 Od. EAW = $175 Sav

A machine that have the following costs is under consideration for a new manufacturing process. Compute the Equivalent Annual Worth with an interest rate of 8%, compounded semiannually. The machine last 8 years. First cost: $60,000 Semiannual Operating cost: $6,000 Semiannual incomes: $14,000 Salvage value $10,000 a. EAW = $2,285 Ob. EAW = $3,310 OC. EAW = $ 21,745 Od. EAW = $175 Sav

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

Who doesn't love food trucks? Imagine you are being offered to invest in a food truck as part of a restaurant business. The truck including equipment costs $100,000, has an expected useful lifespan of 10 years, and the estimated salvage value then is $5,000. The food truck will require a $20,000 overhaul after 6 years of use. The food truck costs $5000 per year to operate and maintain, but it will save the underlying restaurant operator $40,000 per year in labour and lease payments. As you are contemplating the offer you evaluate the economics of this idea... Your cost of borrowing money is 10%. You set yourself an MARR of 14%. What should you do? Invest or not? a) Use a timeline graph to summarize cash outflows and inflows over time. b) Conduct the ERR analysis. Explain each step of your analysis and related assumptions. Report the level of ERR for this proposal and discuss whether or not you (the decision maker) should invest?
2. Two alternatives, a flexible manufacturing cell and fixed automation, have different cost and revenue characteristics as follows: Flexible Cell Fixed Automation Investment S2,500,000 б уears S800,000 in first year; increasing by $100,000 each year thereafter $300,000/year $1,500,000 3 years S800,000/year Life Gross cash savings s100,000 in the first year; decreasing to S80,000 in second year and S70,000 in third year Cash disbursement MARR 20% 20% Assuming "repeatability" and service needed for 6 years, show which alternative is preferred using the method of rate of return.
Calculate the annual worth uniform series in years 1 through 10 for the following incomes and expenses, If the interest rate is 1596 per year. Expense, S/Year 10,000 2,000 Year Income, S/Y ear 1-6 7,000 7-10 1,000 2,000 Selected Answer: 3 [None Given] Correct Answer: $1,532
Hand written plz asap i'll upvote
A $2500 computer system can be leased for $79 per month for 3 years. After 3 years, it can be purchased for $750. This is also the salvage value if the system was purchased originally. What is the effective annual rate for leasing the computer? Ans. r = 1.75% and Effective Annual Annual Rate = 23.1% Please shows the formula used dont make a shortcut answer. Provide full detailed solution.
Problem 13 The Keiser Mining Company must deposit money in an account TODAY (n=0) to cover the anticipated cleanup costs that will begin when the mine closes. These cleanup costs of $6000 will begin in year 5 and repeat every 2 years, as shown below. The account will pay 5% annual interest. $6 $6 $6 $in thousands of 5 - ST 10 11 = The amount Keiser Mining Company should deposit TODAY is closest to: a. $45,900 b. $48,200 c. $50,600 d. $58,500
Littrell's Nursery needs a new irrigation system. System one will cost $145,000, have annual maintenance costs of $10,000, and need an overhaul at the end of year six costing $30,000. System two will have first year maintenance costs of $5,000 with increases of $500 each year thereafter. System two would not require an overhaul. Both systems will have no salvage value after 12 years. If Littrell's cost of capital is 4%, using annual worth analysis determine the maximum Littrell's should be willing to pay for system two.
A transit system is considering buying 6 more buses to provide better service. It will cost $100,000 for buying a new bus and $15,000 per year for maintenance and operation for the following 8 years. If the city’s MARR is 8%, what is the equivalent uniform annual cost of this project? Assume the bus has no value at the end of 8 years.
Build modelA new engineer is evaluating whether to usea higher-voltage transmission line. It will cost $245,000 more initially, but it will reduce transmission losses. The optimistic, most likely, and pessimistic projections for annual savings are $21,000, $14,000, and $9,000 respectively. The interest rate is 7%, and the transmission line has a life of 30 years. (a) What is the present worth for estimated value of each scenario? (b ) What is the expected (mean) Present Worth?
A sportswear factory has two alternative machines for producing jerseys. Costs are shown below. Minimum acceptable rate of return is 8%.What is the annual cost for machine Y?
PLEASE TAKE INTO ACCOUNT THAT "g" EQUALS 7 IN THIS PROBLEM AND PLEASE DRAW THE CASH FLOW DIAGRAM
* 8