A manager is considering installation of one of the following two machines in his factory24Panther$30,000CheelerMore Info 1$90,000$20,000$30,00046NoneNoneInitial CostAnnual CostsService life (years)Salvage valueSince the machines have different service lives, his economic analysis will assume repeatability and usean analysis period of 12 years. Given a MARR of 10% per year, calculate the following two parametersClick the icon to view the interest and annuity table for discrete compounding when /-10% per month.The EUAC of the Cheeter over the analysis period is (select the closest value)OA. $9,335OB. $50,665OC. $43,209OD. $101,330OE. $56,417The PW of the Cheeter over the analysis period is (select the closest value).OA. $441,318OB. $384,408OC. $345,216The of"wieOA BIO.ОсOR H"00"15ожиклиDermTOW56B90TYU1OP

To evaluate the two machines, Panther and Cheeter, calculate the following:The Equivalent Uniform…

Answered: A manager is considering installation…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Chambers Company has just gathered estimates forconducting a break-even analysis for a new product.Variable costs are $7 a unit. The additional plant willcost $48,000. The new product will be charged $18,000a year for its share of general overhead. Advertisingexpenditures will be $80,000, and $55,000 will be spenton distribution. If the product sells for $12, what is thebreak even point in units? What is the break even pointin dollar sales volume?
A building cost P8.5 million and the salvage value is P50,000 after 23 years. The annual maintenance cost is P85,000, costs of repair is P350,000 every 3 years. Find the capitalized cost if money worth 14% per annum. What is the renewal cost? What is the capitalized cost? (2 decimal places, rounded off), if whole number no need to add .00
Investment Cost Useful Life 15 years Market Value, aka salvage value (EOY 15) 3,000 Annual Operating Expenses Overhaul cost--EOY 5 Overhaul cost--EOY10 ('000s of $) 13,000 $19,553,380. NO. 1,000 $19,210,488. YES 200 Evaluate a combined cycle power plant on the basis of the PW method when the MARR is 12% per year. Pertinent cost data are shown in the table. Should the plant be built? 550 $19,553,380. Impossible to say without additional information. O $19,210,488. Impossible to say without additional information.
period of 5 years. Salvage value is estimated at 10% of its first cost. The interest rate is 12% per at $ 150,000. Labor and other operating costs are estimated to be $35,000 per year over the study high-use component can be purchased (bought) for S 25 per unit with a quick delivery. QWA Electronics is considering between two alternatives for their electronic components' needs. A Mestion #6 (20 points) cost of $ 5 per unit. For this option of making the product, QWA needs to purchase equipment today Alternatively, QWA can make the components in-house and have it already available at a variable year. Determine the breakeven quantity based on annual worth of cash flows. 0. Indicate whether to buy or make the components at the expected usage level of 5000 units per year. Explain your answer. a.
Data for two 50-hp motors are as follows: Alpha motor Beta motor Original cost P37 500 P48 000 Annual maintenance 1500 750 Life, years Efficiency 10 10 87% 92 % Taxes and insurance 3% 3% Power cost is P2 per kWh. If money is worth 20%, how many hours per year would the motors have to be operated at full load for them to be equally economical? If the expected number of hours of operation per year exceeds the break-even point, which motor is more economical?
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New microelectronics testing equipment was purchased 2years ago by Mytesmall Industries at a cost of $600,000. Atthat time, it was expected to be used for 5 years and thentraded or sold for its salvage value of $75,000. Expandedbusiness in newly developed international markets is forcingthe decision to trade now for a new unit at a cost of$800,000. The current equipment could be retained, ifnecessary, for another 2 years, at which time it would have a$5000 estimated market value. The current unit is appraisedat $350,000 on the international market, and if it is used foranother 2 years, it will have M&O costs (exclusive ofoperator costs) of $125,000 per year. Determine the valuesof P, n, S, and AOC for this defender if a replacementanalysis were performed today. P = market value =$350,000AOC = $125,000 per yearn = 2 yearsS = $5,000
For th below two machines and based on CC analysis which machine we should select? MARR=10% Machine A Machine B First cost, $ Annual cost, $/year Salvage value, $ Life, years 3 Answer the below question: B- the CC for machine B= 20,538 11,820 7,655 infinite 113,798 8,894
Q15. For the cash flows shown, determine the incremental cash flow between machines B and A (a) in year 0, (b) in year 3, and (c) in year 6. Machine First Cost, $ A B -13,000 -25,000 AOC, $ per Year -1,300-400 Life, Years Salvage Value, $ 5,000 6,000 3 6 a) The incremental cash flow between machines B and A in year 0 is $ . b) The incremental cash flow between machines B and A in year 3 is $. c) The incremental cash flow between machines B and A in year 6 is $ .
Machines that have the following costs are under consideration for a robotized welding process. Use an interest rate of 10% per year and PW analysis to determine which machine should be selected. Machine X Machine Y First cost, $ −250,000 −430,000 AOC, $ per year −60,000 −40,000 Salvage value, $ 70,000 95,000 Life, years 3 6
The fixed costs at Harley Motors are $1million annually. The main product hasrevenue of $8.50 per unit and $4.25 variablecost. Determine the following.(a) Breakeven quantity per year.(b) Annual profit if 200,000 units are soldand if 350,000 units are sold. 2. For the estimates below, calculate thefollowing.(a) Breakeven quantity per month.(b) Profit (loss) per unit at sales levelsthat are 10% above and 10% belowbreakeven.r = $39.95 per unit v = $24.75 per unitFC =$4,000,000 per year
A company wants to automize its production line. Two main technology shortlisted after several studies on the market. If the MARR is 0.1 and the life spans of technology A and B are 3 and 6 years respectively. Answer the following questions by using PW method. Note: all of the cost and revenue units are in thousand dollars. Costs Technology A Technology B First cost, $ -234 436 Annual Operation Cost, $ -56 42 Maintenance Cost, $ -13 per Year -29.2 each 2 years 50 98 Salvage Value, $ Life, Year 3 a) What is the PW of Technology A?

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