Draw cash flow diagrams with symbols. Show your work using conversion factor notations. You need actual calculations to make a decision 1. The manager of engineering at the 900-megawatt Hamilton Nuclear Power Plant has three options to supply personal safety equipment to employees. Two are vendors who sell the items, and a third will rent the equipment for $50,000 per year, but for no more than 3 years per contract. These items have relatively short lives due to constant use. The MARR is 10% per year. Vendor R Vendor T Rental Initial cost, $ -75,000 -125,000 Annual upkeep cost, $/year -27,000 -12,000 Annual rentalcost, $ per year -50,000 Salvage value, $ 30,000 Estimated life, 3 Maximum years of 3
Draw cash flow diagrams with symbols. Show your work using conversion factor notations. You need actual calculations to make a decision 1. The manager of engineering at the 900-megawatt Hamilton Nuclear Power Plant has three options to supply personal safety equipment to employees. Two are vendors who sell the items, and a third will rent the equipment for $50,000 per year, but for no more than 3 years per contract. These items have relatively short lives due to constant use. The MARR is 10% per year. Vendor R Vendor T Rental Initial cost, $ -75,000 -125,000 Annual upkeep cost, $/year -27,000 -12,000 Annual rentalcost, $ per year -50,000 Salvage value, $ 30,000 Estimated life, 3 Maximum years of 3
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![Draw cash flow diagrams with symbols.
Show your work using conversion factor
notations. You need actual calculations to
make a decision
1. The manager of engineering at the 900-megawatt Hamilton Nuclear
Power Plant has three options to supply personal safety equipment to
employees. Two are vendors who sell the items, and a third will rent the
equipment for $50,000 per year, but for no more than 3 years per
contract. These items have relatively short lives due to constant use. The
MARR is 10% per year.
Vendor R
Vendor T
Rental
Initial cost, $
-75,000
-125,000
Annual upkeep cost, $/year -27,000
-12,000
Annual rentalcost, $ per year
-50,000
Salvage value, $
30,000
Estimated life,
2
3
Maximum years of 3](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F90c32010-1895-47ed-8e2d-daa69104bd1c%2F7caa8a93-a6ed-45d9-b748-0592af2455c3%2Felflk3_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Draw cash flow diagrams with symbols.
Show your work using conversion factor
notations. You need actual calculations to
make a decision
1. The manager of engineering at the 900-megawatt Hamilton Nuclear
Power Plant has three options to supply personal safety equipment to
employees. Two are vendors who sell the items, and a third will rent the
equipment for $50,000 per year, but for no more than 3 years per
contract. These items have relatively short lives due to constant use. The
MARR is 10% per year.
Vendor R
Vendor T
Rental
Initial cost, $
-75,000
-125,000
Annual upkeep cost, $/year -27,000
-12,000
Annual rentalcost, $ per year
-50,000
Salvage value, $
30,000
Estimated life,
2
3
Maximum years of 3
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