A remotely located air sampling station can be powered by solar cells or by running an electric line to the site and using conventional power. Solar cells will cost $15000 to install and will have a useful life of 4 years with no salvage value. Annual costs for inspection, cleaning, etc. are expected to be $1500. A new power line will cost $13000 to install, with power costs expected to be $1200 per year. Since the air sampling project will end in 4 years, the salvage value of the line is considered to be zero. At an interest rate of 14.00% per year, which alternative should be selected on the basis of a future worth analysis? (Include a minus sign if necessary.) The future worth of solar cells is $ _____ and that of electric line is $_____ . ?Solar cells? or ?Electric line? should be selected on the basis of a future worth analysis.
A remotely located air sampling station can be powered by solar cells or by running an electric line to the site and using conventional power. Solar cells will cost $15000 to install and will have a useful life of 4 years with no salvage value. Annual costs for inspection, cleaning, etc. are expected to be $1500. A new power line will cost $13000 to install, with power costs expected to be $1200 per year. Since the air sampling project will end in 4 years, the salvage value of the line is considered to be zero. At an interest rate of 14.00% per year, which alternative should be selected on the basis of a future worth analysis? (Include a minus sign if necessary.)
The future worth of solar cells is $ _____ and that of electric line is $_____ .
?Solar cells? or ?Electric line? should be selected on the basis of a future worth analysis.
Step by step
Solved in 3 steps with 2 images
