Economics A new machine can be purchasedfor$80,000. Its expected useful life is 5 years, at which time its market value will be $6,000. Annual revenues less expenses due tothe new machine will be $20,000 per year overthe five-year period. Assume a MARR of 10% to determine if this is a good investment by using. a) the PW method b)the FW method c) the AW method d) The IRR method e) The ERR method

Economics A new machine can be purchasedfor$80,000. Its expected useful life is 5 years, at which time its market value will be $6,000. Annual revenues less expenses due tothe new machine will be $20,000 per year overthe five-year period. Assume a MARR of 10% to determine if this is a good investment by using. a) the PW method b)the FW method c) the AW method d) The IRR method e) The ERR method

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A labor saving device system save $2,000 per year for five (5) years. It can be installed at a cost of $8,000. The rate of return on this planned investment is most nearly: a.9.36% b.10% c.10.36% d.12.36%
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QUESTION 7 for th below two machines and based on AW analysis which machine we should select? MARR-10%. Machine A Machine B First cost, $ 100,000 Annual cost, S/year 7,000 Salvage value, $ Life, years 3 infinite Answer the below question: A-the AW for machine A QUESTION 8 For th below two machines and based on AW analysis which machine we should select? MARR-10% Machine A Machine B First cost, $ 135,982 Annual cost, Siyear 8,740 12.308 Salvage value, $ Life, years 3 infinite Answer the below question: B- the AW for machine B QUESTION 9 C-Based on the AW value you got in the previous 2 questions, which machine we should select? type you explanation below For the toolbar, press ALT+F10 (PC) or ALT-FN-F10 (Mac) B IUS Paragraph M Arial Y 10pt 田饼印园 BE 0) 20,000 9,000 4,000 23,720 4.805- !!! 4
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Engineering Economics1
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