Choose from the two machines which is more economical:Machine AMachine BFirst CostP12,000P17,000Salvage ValueAnnual OperationP2,0002,4001,0003,000Annual Maintenance1,200Taxes and Insurance3%3%Life, years1015 Money is worth at least 16%Rate of Return on Additional Investment MethodAnnual Cost MethodPresent Worth Cost MethodEquivalent Uniform Annual Cost Method

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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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Q5: The machine using PW with first cost $75000, savings the annual operating cost $11000 per year and salvage value $55000 at the end of 4 years find the (P/F, i*,6).
The following three alternatives have been developed and costed to improve the efficiency of aircraft engines. Compare the alternatives using capitalized cost and a MARR of 10% per year compounded annually. Alternative Alternative Alternative G First Cost, $ -1,000,000 -3,000,000 -5,000,000 Net income $ per year 325 000 400,000 600,000 Salvage value, S 50,000 70,000 Life, years 4 8.
In the choice of mechanical equipment you are required to submit your recommendation as to which of the two steam shovels for earth excavation is better to buy. The basis is 20 year service & interest at 7%. Taxes & insurance are the same in each case: 5% & 1% respectively. Use Annual Cost & CC. 50-ton shovel 70 ton shovel First Cost P30k P38k 20 years 20 years P2k Life Salvage value Annual Operation Annual Upkeep Annual Output P3k P15k P17k P1.5k P2k 150k yards 200k yards
9. A local company is analyzing 5 alternatives for a new machine the information is given in the table below. Option Cost Savings per Year Salvage value FV Vehicle life n A -$10,000.00 $ 2,050.00 $ 500.00 B -$12,500.00 $ 3,405.00 -$15,300.00 $ 3,680.00 -$20,500.00 $ 5,281.50 -$30,125.00 $ 6,785.00 C D E $1,000.00 $3,000.00 $ 5,000.00 $5,000.00 5 5 5 5 5 a) which alternative should be selected without considering salvage value? The company is considering a MARR of 7%. b) which alternative should be selected with considering salvage value? The company is considering a MARR of 10%.
S7.33 Tim Smunt has been asked to evaluate two machines. After some investigation, he determines that they have the costs shown in the following table. He is told to assume that: a) the life of each machine is 3 years, and b) the company thinks it knows how to make 12% on investments no more risky than this one. Machine A Machine B Original cost Labor per year Maintenance per year Salvage value $10,000 2,000 $20,000 4,000 1,000 7,000 4,000 2,000 Determine, via the present value method, which machine Tim ce should recommend.
urgent please in one hour
Solve it correctly please. I will rate.
5. Dawg Engineering is considering a new machine for its assembly line, Each choice has a 10 year life. Calculate the IRR for each alternative Initial Cost $132,000.00 $186,000.00 $144,000.00 Annual Benefit $52,000.00 $42,00.00 $56,000.00 Yearly O & M $33,000.00 $12,000.00 $32,000.00 cost Salvage value $15,000.00 $9,000.00 $16,000.00 IRR-A IRR-B IRR-C
At i = 10% per year, a machine has a first cost of $9,000 and estimated operating costs and year-end salvage values as shown. The annual equivalent cost if you operate the machine for 3 years is closest to which value? Operating Salvage Cost, $ Value, $ 7000 Year -1000 -1200 5000 -1500 4200 -2000 3000 -3000 2000 O-$-3,568 = $-3,770 -1500 4200 -2000 3000 -3000 2000 O =$-3,568 O = $-3,770 = 2-3,636 %3D O =$-3,454 O = $-3,832 123 n 345

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Choose from the two machines which is more economical: Machine A Machine B First Cost P12,000 P17,000 Salvage Value Annual Operation P2,000 3,000 2,400 Annual Maintenance 1,200 1,000 Taxes and Insurance 3% 3% Life, years 10 15