A remotely located air sampling station can be powered by solar cells or by running an electric line to the site and using conventionalpower. Solar cells will cost $19000 to install and will have a useful life of 4 years with no salvage value. Annual costs for inspection,cleaning, etc. are expected to be $1100. A new power line will cost $9000 to install, with power costs expected to be $800 per year.Since the air sampling project will end in 4 years, the salvage value of the line is considered to be zero. At an interest rate of 14.00%per year, which alternative should be selected on the basis of a future worth analysis? (Include a minus sign if necessary.)The future worth of solar cells is $and that of electric line is $(Click to select) should be selected on the basis of a future worth analysis.

The initial investment sum is what is meant by the annual worth, but the final sum, which includes…

emotely located air sampling station can be powered by solar cells or by running an electric line to the site and using conventiona wer. Solar cells will cost $19000 to install and will have a useful life of 4 years with no salvage value. Annual costs for inspection, aning, etc. are expected to be $1100. A new power line will cost $9000 to install, with power costs expected to be $800 per year. ce the air sampling project will end in 4 years, the salvage value of the line is considered to be zero. At an interest rate of 14.00% year, which alternative should be selected on the basis of a future worth analysis? (Include a minus sign if necessary.) e future worth of solar cells is $ and that of electric line is $ ick to select) should be selected on the basis of a future worth analysis.

emotely located air sampling station can be powered by solar cells or by running an electric line to the site and using conventiona wer. Solar cells will cost $19000 to install and will have a useful life of 4 years with no salvage value. Annual costs for inspection, aning, etc. are expected to be $1100. A new power line will cost $9000 to install, with power costs expected to be $800 per year. ce the air sampling project will end in 4 years, the salvage value of the line is considered to be zero. At an interest rate of 14.00% year, which alternative should be selected on the basis of a future worth analysis? (Include a minus sign if necessary.) e future worth of solar cells is $ and that of electric line is $ ick to select) should be selected on the basis of a future worth analysis.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

The following annual costs are associated with three new extruder machines being considered for use in a Styrofoam cup plant: Data Useful Life, Years First Cost Salvage Value Annual Benefit M&O M&O Gradient X 17 $2,500,000 $105,000 $199,000 $65,000 $16,000 X-TRUD 13 $2,620,000 $109,000 $614,000 $80,000 $14,500 O Choosing SUPR-X is best because it has the highest Annual Benefit Choosing SUPR-X is best because it has the lowest M&O cost in yr1 SUPR-X 7 $2,020,000 $117,000 $671,000 $56,000 $11,000 The company's interest rate (MARR) is 4%. Which extruder should the Styrofoam company choose? Use Annual Cash Flow Analysis and provide the right reason. O Choosing SUPR-X will maximize the EUAB-EAUC; its value is $442,101 higher than X and $62,879 higher than X-TRUD. O Choosing SUPR-X will maximize the EUAB-EAUC; its value is $-38,899 higher than X and $-18,121 higher than X-TRUD.
Question 4 Complete the following analysis of cost alternatives and select the preferred alternative. The study period is 10 years and the MARR = 12% per year. "Do Nothing" is not an option. A B C D $15,000 $16,000 $13,000 $18,000 Capital investment Annual costs 250 300 500 100 Market value 1,000 1,300 1,750 2,000 at EOY 10 FW(12%) -$49.975-$53,658 ???-$55,660
If More than 2 alternatives you are Company and to decide of is trying investment A > Incremental analysis (Alternativ Alternative: A > Incremental analysis B C if the additional increment Worth while, compare. pairs wins then B vs C A Company Considering 2 different machines at MARR at 12% Both life spans = 10 years M/C X M/CY Initial Cost 160000 285000 Annual Operating Cost 45000 45000 Benefits per year Salvage Value 90000 105000 20000 40000
Baguio Rabbitry must replace the piping system in its barn. Based on cost of capital of 12% which of the two following alternatives should be chosen using the following methods? a) RORAI b) AW c) PW Pamper pipes P 75,000 Fluid Flush P 90,000 First Cost Operating costs per 5,000 4,000 year Savings per year Salvage value 1,000 2,000 2,000 Useful life 10 10
Use Annual Cost Analysis to determine whether Alternative A or B should be chosen. The analysis period is 5 years. Assume an interest rate of 6% per year, compounded annually Alternative A Alternative B Initial Cost Annual Benefit Salvage Value Useful Life (yrs) 1800 150 400 5 4230 340 2100 5 Alternative B should be chosen, because its annual benefit is higher than Alternative A's Alternative A should be chosen, because its initial cost is lower than Alternative B's Alternative B should be chosen, because its equivalent annual cost is $85.30 higher than Alternative A's Alternative A should be chosen, because its equivalent annual cost is $85.30 lower than Alternative B's
Compare the alternatives shown below on the basis of their AW and determine which alternative should be selected? Using the interest rate 10% per year. - AW of Alternative X: AW of alternative Y: Which alternative will be selected on the basis of AW analyses? Item Alt. X Alt. Y First cost $ Annual income, S/Year Annual operating cost, S/year Annual cost start at 3rd year Salvage value Life, year 100,000 40,000 10,000 20,000 8 500,000 60,000 30,000 8,000 75
The cash flows for two small raw water treatment systems are shown. ِA. Determine which should be selected on the basis of an annual worth analysis at 10% per year interest. B. Draw a cash flow diagram
In engineering economics it is often used present worth analysis to determine best alternative between options. I was wondering how do we know what type of formula to use. Sometimes it is used the formula with P/A, others A/P, as F/A and P/F and so on. How do we know which fraction to use?
3. PEMEX, Mexico's petroleum corporation, has an estimated budget for oil and gas exploration that includes equipment for three offshore platforms as shown. Use the PW to select the best alternative at a MARR of 14% per year. Platform X Y Ꮓ Initial Cost, $ million 300 450 510 M&O, $ million per year 320 290 230 Salvage Value, $ million 75 50 90 Estimated Life, years 20 20 20
The Larkspur Furniture Company needs a new grinder. Compute the present worth for these mutually exclusive alternatives and identify which you would recommend given i = 6% per year. Larkspur uses a 10-year planning horizon.
Complete the following analysis of cost alternatives and select the preferred alternative. The study period is 10 years and the MARR = 15% per year. "Do Nothing" is not an option. A B C Capital investment $15,000 $16,000 $13,500 $18,100 Annual costs 260 290 450 110 Market value at EOY 10 900 1,350 1,700 2,050 FW (15%) - $65,062 - $69,267 ??? - $73,408
For alternatives shown in the table below and on the basis of their capitalized costs CC and an interest rate of 10% per year. Answer the following questions to select the better option: Alternative 45,025 5.000 Fist cost 5 249.854 13,000 Maintenance costs, 1 per year Salvage valu Periodic costs Severy 10 years e years 2.000 10,000 10.000 4. CC for alternative A