Consider the following EOY cash flows for two mutually exclusive alternatives (one must be chosen). The MARR is 6% per year. Capital investment Annual expenses Lead Acid $5,000 $2,250 Lithium lon $15,000 $2,500 12 years Market value at end of useful life $0 18 years $2,800 Useful life Click the icon to view the interest and annuity table for discrete compounding when i = 6% per year. a. Determine which alternative should be selected if the repeatability assumption applies. The AW of the Lead Acid is $ -2847. (Round to the nearest dollar.) The AW of the Lithium Ion is $ - 3795. (Round to the nearest dollar.) Which alternative should be selected? Choose the correct answer below. Lead Acid Lithium Ion b. Determine which alternative should be selected if the analysis period is 18 years, the repeatability assumption does not apply, and a battery system can be leased for $7,000 per year after the useful life of either battery is over. The PW of the Lead Acid is $ (Round to the nearest hundreds.)
Consider the following EOY cash flows for two mutually exclusive alternatives (one must be chosen). The MARR is 6% per year. Capital investment Annual expenses Lead Acid $5,000 $2,250 Lithium lon $15,000 $2,500 12 years Market value at end of useful life $0 18 years $2,800 Useful life Click the icon to view the interest and annuity table for discrete compounding when i = 6% per year. a. Determine which alternative should be selected if the repeatability assumption applies. The AW of the Lead Acid is $ -2847. (Round to the nearest dollar.) The AW of the Lithium Ion is $ - 3795. (Round to the nearest dollar.) Which alternative should be selected? Choose the correct answer below. Lead Acid Lithium Ion b. Determine which alternative should be selected if the analysis period is 18 years, the repeatability assumption does not apply, and a battery system can be leased for $7,000 per year after the useful life of either battery is over. The PW of the Lead Acid is $ (Round to the nearest hundreds.)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Transcribed Image Text:Consider the following EOY cash flows for two mutually exclusive alternatives (one must be chosen). The MARR is 6% per year.
Capital investment
Annual expenses
Lead Acid
$5,000
$2,250
Lithium lon
$15,000
$2,500
12 years
Market value at end of useful life
$0
18 years
$2,800
Useful life
Click the icon to view the interest and annuity table for discrete compounding when i = 6% per year.
a. Determine which alternative should be selected if the repeatability assumption applies.
The AW of the Lead Acid is $ -2847. (Round to the nearest dollar.)
The AW of the Lithium Ion is $ - 3795. (Round to the nearest dollar.)
Which alternative should be selected? Choose the correct answer below.
Lead Acid
Lithium Ion
b. Determine which alternative should be selected if the analysis period is 18 years, the repeatability assumption does not apply, and a battery system can be leased for $7,000 per year after the useful life of either battery is over.
The PW of the Lead Acid is $ (Round to the nearest hundreds.)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 3 images
Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education