A retrofitted space-heating system is being considered for a small office building. The system can be purchased and installed for $72,000, and it will save an estimated 210,000 kilowatt-hours (kWh) of electric power each year over a six-year period. A kilowatt-hour of electricit costs $0.14, and the company uses a MARR of 12% per year in its economic evaluations of refurbished systems. The market value of the system will be $14,400 at the end of six years, and additional operating and maintenance expenses are $7,900 per year. Use the benefit-cost method to make a recommendation. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 12% per year. The conventional B-C ratio of the system is (Round to two decimal places.) This B-C ratio indicates that the project is acceptable not acceptable

A retrofitted space-heating system is being considered for a small office building. The system can be purchased and installed for $72,000, and it will save an estimated 210,000 kilowatt-hours (kWh) of electric power each year over a six-year period. A kilowatt-hour of electricit costs $0.14, and the company uses a MARR of 12% per year in its economic evaluations of refurbished systems. The market value of the system will be $14,400 at the end of six years, and additional operating and maintenance expenses are $7,900 per year. Use the benefit-cost method to make a recommendation. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 12% per year. The conventional B-C ratio of the system is (Round to two decimal places.) This B-C ratio indicates that the project is acceptable not acceptable

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Two traffic signal systems are being considered for an intersection. One system costs $31,000 for installation and has an efficiency rating of 80%, requires 26 kW power (output), incurs a user cost of $0.23 per vehicle, and has a life of 9 years. A second system costs $47,000 to install, has an efficiency rating of 87%, requires 34 kW power (output), has a user cost of $0.19 per vehicle, and has a life of 17 years. Annual maintenance costs are $75 and $95, respectively. MARR = 8% per year. How many vehicles must use the intersection to justify the second system when electricity costs $0.09/kWh? Assume salvage value for each system equals zero. Project the difference in the user cost as savings for the second system. There are approximately 8,760 hours/year. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 8% per year. At least 108000 vehicles per day must use the intersection to justify the second system. (Round up to the nearest whole…
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A retrofitted space-heating system is being considered for a small office building. The system can be purchased and installed for $95,000, and it will save an estimated 150,000 kilowatt-hours (kWh) of electric power each year over a seven-year period. A kilowatt-hour of electricity costs $0.12, and the company uses a MARR of 12% per year in its economic evaluations of refurbished systems. The market value of the system will be $19,000 at the end of seven years, and additional operating and maintenance expenses are $10,500 per year. Use the benefit-cost method to make a recommendation. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 12per year. The conventional B-C ratio of the system is 1.48. (Round to two decimal places.) This B-C ratio indicates that the project is not acceptable.
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