A special-purpose 30-horsepower electric motor has an efficiency of 91%. Its purchase and installation price is $2,200. A second 30-horsepower high-efficiency motor can be purchased for $3,100, and its efficiency is 92%. Either motor will be operated 3,500 hours per year at full load, and electricity costs $0.09 per kilowatt-hour (kWh). MARR = 12% per year, and neither motor will have a market value at the end of the eight-year study period. a. Which motor should be chosen? b. For an incremental investment of $900 in the more efficient motor, what is the PW of the energy savings over the eight-year period? Recall that 1 hp = 0.746 kW. Click the icon to view the interest and annuity table for discrete compounding when i=12% per year. a. The PW of the motor with the efficiency of 91% is $ (Round to the nearest dollar.)

A special-purpose 30-horsepower electric motor has an efficiency of 91%. Its purchase and installation price is $2,200. A second 30-horsepower high-efficiency motor can be purchased for $3,100, and its efficiency is 92%. Either motor will be operated 3,500 hours per year at full load, and electricity costs $0.09 per kilowatt-hour (kWh). MARR = 12% per year, and neither motor will have a market value at the end of the eight-year study period. a. Which motor should be chosen? b. For an incremental investment of $900 in the more efficient motor, what is the PW of the energy savings over the eight-year period? Recall that 1 hp = 0.746 kW. Click the icon to view the interest and annuity table for discrete compounding when i=12% per year. a. The PW of the motor with the efficiency of 91% is $ (Round to the nearest dollar.)

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

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…
Waller County is planning to construct a Dam some tens of miles away from the Hempstead Recreation center to facilitate fishing in the El Manny River Basin and Power Generation. The first cost for the Dam will amount to $6,500,000. Annual maintenance and repairs will amount to $24,000 for the first four years, to $28,000 for each year in the next eight years, and to $32,000 per year for the next four years. At the end of the 16th year, $25,000 is estimated to be deposited into Waller county account as tax credits earned for its environmental compliance in the construction and operation of the Dam. In addition a major overhaul costing $650,000 will be required at the end of the seventh year. Use an interest rate of 10% and : a) Determine the engineering economy symbols and their value for each option. b) Construct the cash flow diagram c) Calculate the Capital Recovery for the project
Question 4 Consider a proposal to enhance production of tortillas en a taqueria. The new machine is estimated to cost $30 million and will incur an additional $1 million per year in maintenance costs. The machine will produce annual savings of $6 million each year. The Minimum acceptable rate of return (MARR) is 11% per year, and the study period is five years at which time the machine will be obsolete (worthless). What is the maximum (minimum) value of maintenance cost that reverse your decision? Write 4 decimals
A distribution company is considering three different alternatives to satisfy their customer's demands. Their options are to rent a ready distribution center (D01), Rent and mobilize a center (D02), or outsourcing (OS). The estimate for each method is shown. The lifetime for D01, D02, and OS are 3, 6, and 2 respectively. MARR is 0.04 per year, and the percentage of change for all of the cases are 0 % Note: all units are in thousand $ D01 First Cost, $ Annual Operation Cost, $ Salvage Value, $ a: Calculate the Fw of D01? -136 -92 28 D02 OS -973 0 -59 -123 333 0
Dupont is considering licensing a low liquid discharge (LLD) water treatment system from a small company that developed the process and owns the license. Dupont can purchase a 1-year option for $100,000 that will provide time to pilot test the LLD process or Dupont can acquire the license now at a cost of $1.8 million plus 25% of sales paid annually to the license owner. If they wait 1 year, the cost will increase to $1.9 million plus 30% of sales paid annually. If sales are estimated to be $1,000,000 per year over the 5-year license period, should Dupont purchase the license now or purchase the option now and possibly license it after the 1-year test period? Assume the MARR is 15% per year.
Machine A costs Q10,000.00, with a recovery value of Q4,000.00 at the end of 5 years and has annual expenses ofoperation of Q5,000.00 during the first three years and Q6,000.00 during the last 2. Machine B costsQ14,000.00, with a recovery value of Q3,000.00 at the end of 10 years. Its operating expenses amount to Q3,500.00annually during the 5 years and Q4,500.00 during the last 5. The increases in operating expenses are theexpected for maintenance, repair and loss of efficiency due to use. The minimum required rate of returnis 15%a) Make the graph and determine the annual cost and make the respective comparison between the two machines.b) Select the most feasible machine.c) Determine the future worth in year 10 for both machines.d) Determine the quarterly value during the 10 years for both machines.e) As an Engineer you are asked to determine an action plan, define objectives, activities to overcome the bestalternative and estimating a new NPV, which exceeds 15% the best optionf)…
The Civil Engineering department at RRCP plans to purchase a 3D printer for the CARSI lab. One option is the purchase of a brand new machine (purchase price $1900), and will have a salvage value of $700 after three years. A second option is the purchase of a refurbished machine (purchase price $1200), which will cost $250 per year to maintain, with a salvage value of $250 after three years. What is the interest rate that will make these two options equivalent with respect to Present Worth?
A $45,000 investment in a new conveyor system is projected to improve throughput and increasing revenue by $14,000 per year for five years The conveyor will have an estimated market value of $4,000 at the end of five years. Using an MARR = 12% per year, what is the FW? $-19,329.40 $13,635.70 $16,998.90 none of the above K ?
Your firm is thinking about investing $300,000 in the overhaul of a manufacturing cell in a lean environment. Revenues are expected to be $33,000 in year one and then increasing by $11,000 more each year thereafter. Relevant expenses will be $20,000 in year one and will increase by $10,000 per year until the end of the cell's seven-year life. Salvage recovery at the end of year seven is estimated to be $11,000. What is the annual equivalent worth of the manufacturing cell if the MARR is 8% per year? Click the icon to view the interest and annuity table for discrete compounding when the MARR is 8% per year. The annual equivalent worth of the manufacturing cell is $. (Round to the nearest dollar.)
An aerodynamic three-wheeled automobile (the Dart) runs on compressed natural gas stored in two cylinders in the rear of the vehicle. The $15,000 Dart can cruise at speeds up to 85 miles per hour, and it can travel 95 miles per gallon of fuel. Another two-seater automobile costs $11,000 and averages 45 miles per gallon of compressed natural gas. If fuel costs $8.00 per gallon and MARR is 12% per year, over what range of annual miles driven is the Dart more economical? Assume a useful life of six years for both cars. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 12% per year. Dart is more economical if you are planning on driving miles or more per year. (Round to the nearest whole number.)
The plant manager at a company would like to perform an analysis for a new $250,000 machine. She estimates benefits of $20,000 in the first year, and benefits are increasing by 10% per year. 1) What is the payback period for the machine? 2)Suppose that the machine life is 15 years and machine has a salvage value of 20% of the initial cost at the end of its useful life. If the MARR of the company is 11 % per year, is this investment acceptable? Why?
The maintenance of a machine in a manufacturing plant currently costs a company $8,000 every year (paid at the end of each year) with the cost increasing by $1,000 each subsequent year. Because of this, the plant manager is considering replacing this machine with a newer one which would cost $20,000 to purchase today, and then $4,000/year increasing by $30Ó in each year to maintain (also paid at the end of the year). If the company's MARR is at 8% per year compounded annually, what would be the discounted payback period (in years) for this proposed investment? 4 6. 7