Cleanville Environmental Services is considering investing in a new water treatmentsystem. On the basis of the information given below for two alternatives, a fullyautomated and a partially automated system, construct a spreadsheet for computingthe annual worths for each alternative with a variable MARR. Through trial anderror, determine the MARR at which the annual worth of the two alternatives isequivalent.Year012345678910Fully Automated SystemDisburse-ments$1 000 00030 00030 00080 00030 00030 00080 00030 00030 00080 00030 000Net CashFlow0 - $1 000 000270 000270 000220 000270 000270 000220 000270 000270 000220 000270 000Receipts$300 000300 000300 000300 000300 000300 000300 000300 000300 000300 000Partially Automated SystemDisburse-ments$650 00030 00030 00035 00035 00040 00040 00045 00045 00050 00050 000Net CashFlowReceipts$ 0 - $650 000220 000190 000220 000190 000220 000185 000220 000185 000220 000180 000220 000180 000220 000175 000220 000175 000220 000170 000220 000170 000

MARR refers to minimum accepted rate of return which an investor requires from the investment…

Cleanville Environmental Services is considering investing in a new water treatment system. On the basis of the information given below for two alternatives, a fully automated and a partially automated system, construct a spreadsheet for computing the annual worths for each alternative with a variable MARR. Through trial and error, determine the MARR at which the annual worth of the two alternatives is equivalent. Year 0 1 Fully Automated System Disburse- ments $1 000 000 30 000 Net Cash Flow Receipts $ 0 - $1 000 000 300 000 270 000 Partially Automated System Disburse- ments $650 000 30 000 Net Cash Flow Receipts S 0 - $650 000 220 000 190 000

Cleanville Environmental Services is considering investing in a new water treatment system. On the basis of the information given below for two alternatives, a fully automated and a partially automated system, construct a spreadsheet for computing the annual worths for each alternative with a variable MARR. Through trial and error, determine the MARR at which the annual worth of the two alternatives is equivalent. Year 0 1 Fully Automated System Disburse- ments $1 000 000 30 000 Net Cash Flow Receipts $ 0 - $1 000 000 300 000 270 000 Partially Automated System Disburse- ments $650 000 30 000 Net Cash Flow Receipts S 0 - $650 000 220 000 190 000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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