Consider three mutually exciusive altermatives as part of an upgrade to an existing transportation neworK. Consider MARR is 12% per year. Alternative A Altemative B Alternative C Installed cost $40.000 $30,000 $20,000 Net annual revenue $6,400 $5,650 $5,250 Salvage Value Useful life 20 years 20 years 10 years Suppose the study period has been coterminated at 10 years. Use the imputed market value technique and determine the PW for Alternative A:

Consider three mutually exciusive altermatives as part of an upgrade to an existing transportation neworK. Consider MARR is 12% per year. Alternative A Altemative B Alternative C Installed cost $40.000 $30,000 $20,000 Net annual revenue $6,400 $5,650 $5,250 Salvage Value Useful life 20 years 20 years 10 years Suppose the study period has been coterminated at 10 years. Use the imputed market value technique and determine the PW for Alternative A:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Compare the alternatives below on the basis of their capitalized costs. Assume the MARR is 10% per year, compounded annually Project A Project B Project C First cost ($200,000) ($275,000) ($800,000) Annual income $60,000 $70,000 $80,000 Salvage value $40,000 $60,000 $500,000 Life, years 4 7 infinity
RESUELVA EL SIGUIENTE PROBLEMA Investment Annual operating Cost. Began first (1)year until the 6th year (A=$1,500) Annual Revenues: Began first (1¹h)year until the 6th year. Additional Revenues: Gradient beginning 2nd year G= $800 until the 6th year. Salvage Value at the end of 6th year or MV8= $2,000 Investment life n=6 years. MARR=6% $10,000 1,500 2,500 G=$800 MV6= $2,000 a. Draw the cash flow diagram b. PW, AW and FW Determine if the investment is viable or not. c. IRR d. ERR
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A city government feels that the energy production capacity must be expanded to meet anticipated demands for energy. There are three alternatives to consider: @A nuclear facility with an investment of $250 million, operating costs of $3 million per year and life of 20 years. @ A coal plant with an investment of $200 million operating costs of $10 million per year and a life of 20 years. 26°C I P Type here to search
QUESTION 7 for th below two machines and based on AW analysis which machine we should select? MARR=10%. Machine A First cost, $ Annual cost, $/year Salvage value, $ Life, years 3 Answer the below question: A- the AW for machine A= 25,433 12,199 7,603 Machine B 100,000 7,000 infinite
a. Calculate using the PW method if the useful life is 50 years and the MARR is 10% per year and determine which is the best alternative.b. If the useful life of project A is 25 years, project B and project C are 50 years each, using the AW method, which project will be selected.attached:Investment: A = $8.500.000B $10.000.000C= $12.000.000O & M annual: A $750.000B = $725.000C = $700.000Salvage value: A = $1.250.000B = $1.750.000CS2.000.000annual benefits: A = $2.150.000B = $2.265.000C = $2.500.000
An engineering alternative has a first cost of $12700, and is expected to have net annuai receipts of $1650 for the next 8 years. Assuming no salvage value at the end of the alternative's life, the amount of AW(0%) is: 1. c$500.00 2. C-$500.00 3. C-$62.50 4. C $62.50 5. C NONE.
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Breakeven Example 8.2 • MARR is 12% per year. Select the more economical vendor bid. -8,000 - 13.000 Initial cost. S -3,500 -1.600 Annual costs, S per year Salvage value. $ Life. vears 2,000 10
• Smalltown, PA currently has a $38,000/year contract with a private company to transport students to their school and back. Smalltown can buy a bus for $40,000 that will be adequate for the next 5 years. Operating and maintenance costs are estimated to be $25,000 per year. At the end of 5 years, the bus will have an estimated salvage value of $5,000. Their MARR is 10%/year. а. What is the Excel or closed form equation (along with the value of relevant parameters) to determine this investment's internal rate of return?