Acompany plans to spend $154810 to install a new machine. Annual maintenance cost is $12581. Estimated annual income is $ 33132 starting in the first year. This revenue begin increasing by $ 1063 per year at the end of 2d year and continue increasing through the end of 15 years. The market value of the machine is $ 22137 at the end of study period of 15 years. Determine the annual worth if the minimum attractive rate of return is 9% per year. Answer:

Acompany plans to spend $154810 to install a new machine. Annual maintenance cost is $12581. Estimated annual income is $ 33132 starting in the first year. This revenue begin increasing by $ 1063 per year at the end of 2d year and continue increasing through the end of 15 years. The market value of the machine is $ 22137 at the end of study period of 15 years. Determine the annual worth if the minimum attractive rate of return is 9% per year. Answer:

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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A large standby electricity generator in a hospital operating room has a first cost of $67,250 and may be used for a maximum of 6 years. Its salvage value, which decreases by 15% per year, is described by the equation S = 67,250(1 − 0.15)n, where n is the number of years after purchase. The operating cost of the generator will be constant at $9,000 per year, and the interest rate is 12% per year. Determine the economic service life and associated AW values. The economic service life is 6 years and the AW value is $−__.
A company predicts they will make $17,948 per year over the next 6 years if they spend $14,012 on a machine (an asset with multi-year use). If the MARR is 15.6%, how much is this investment worth per year?
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A commercial 3D printer is purchased for $350,000. The salvage value of the printer decreases by 30% each year that it is held. The cost to operate and maintain the machine the first year it is used is $14,000; these costs increase by $5,000 each year. What is the optimal replacement interval and minimum EUAC for the printer, assuming a MARR of 13% is used? Click here to access the TVM Factor Table Calculator. years ORI: EUAC*: $ Carry all interim calculations to 5 decimal places and then round your final answers to a whole number. The tolerance is ±5 for the EUAC*.
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