From the data shown, determine the ESL of the equipment assuming MARR of 15%. Years Retained Market Value M&O Cost $28,000 $24,000 $22,000 $20,000 $15,000 -$48,000 $49,000 $50,000 -$51,000 3 O ESL = 1 year %3D O None of the above O ESL = 3 years O ESL = 4 years %3D ESL = 2 years %3D

From the data shown, determine the ESL of the equipment assuming MARR of 15%. Years Retained Market Value M&O Cost $28,000 $24,000 $22,000 $20,000 $15,000 -$48,000 $49,000 $50,000 -$51,000 3 O ESL = 1 year %3D O None of the above O ESL = 3 years O ESL = 4 years %3D ESL = 2 years %3D

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: Air-Conditioning System 1 Air-Conditioning System 2 -12.000 -8,000 er year -750 -125 alue, $ -100…

A: The annual worth is the net of the multitude of advantages and costs brought about more than a…

Q: Most likely estimates for a project are as follows. Click the icon to view the relationship between…

A: We need to determine if an initial investment of $5,250 makes a project economically viable given…

Q: QUESTION 7 for th below two machines and based on cC analysis which machine we should select?…

A: A capitalized cost is a cost incurred as a result of the purchase of a fixed asset that is expected…

Q: Lifewear, a manufacturer of women's sports clothes, is considering adding a line of skirts and…

A: The minimum acceptable rate of return is the least return that a financial backer or firm will take.…

Q: Nelson, Inc. is considering investing in new and more efficient equipment The equipment has 10-year…

A: Given, First cost= $800,000 Annual cost = $40,000, increases $20,000 per year Equipment life = 10…

Q: A mining company is considering three alternatives for use as a debris hauler out of one of the…

A: The difference between the present value of cash inflows and outflows over a period of time is known…

Q: Select between the two options using the corporate MARR of 15% per year and a future worth analysis…

A: To compare future worth and select the best investment choice, we translate all cash flows into the…

Q: An investment of $1,090,000 today yields positive cash flows of $200,000 each year for years 1…

A: The discounted payback period (abbreviated as DPBP) will be computed with the consideration of…

Q: Comparing MEAs with equal lives. When lives are equal adjustments to cash flows are not required.…

A: The present worth (PW) refers to the present-day value of a future sum of money or a series of cash…

Q: A tunnel to transport water initially cost $1,000,000 and has expected maintenance costs that will…

A: Given Initial cost =$1,000,000 no. of years =6 years MARR=20% years maintenance cost1…

Q: Two investment projects are being evaluated based on their payback periods. The first altemative…

A: In economics, present value refers to the current value of a future stream of cash flow. Net present…

Q: A company would like to invest on a project. The rate the company uses to justify their investments,…

A: Over the course of an investment, capital recovery refers to the return of your initial investment.…

Q: Consider projects X and Y below. If the MARR is 8%, what is the PW of X and Y respectively, given a…

A: Given MARR = 8 % with LCM analysis the life of both the project is compared with same multiple of 8…

Q: $8000 $4000(1 + 0.15)t- 1 $6000(1 0.3)t ere A(t) stands for the net cash flow in period t and S(t)…

A: Solution Net inflow jn year 1 A(1) = $8000 - $4000 (1+0.15)1-1 = $4000 In year 2 A(2) = $8000 -…

Q: The State of Chiapas, Mexico, decided to fund a program for improving reading skills in elementary…

A: The first cost is $300,000. Update amount at every 5th year forever is $170,000The first cost is the…

Q: 2) A firm has a project with no investment requirement, but it must raze existing buildings over a…

A: An investment's return on investment (RoI) is computed as a percentage of the investment's initial…

Q: The Flynn manufacturing company is undergoing a review by the board of regents for expounding their…

A: The net present value is the best alternative approach for calculating the dynamic calculations of…

Q: Brand A 2 years 3 years $13 4 years $17 5 years Which brand should the engineer select if the MARR…

A: Net Present Value calculates the difference between the present value of cash inflows and outflows.…

Q: 3 LO Construction Co. is planning to purchase a new truck. Company uses MARR as 10% per year.…

A: MARR is 10% so while calculating the PW, consider the rate of interest i =10%.The service life of…

Q: For some years, Mel has contracted with several major pizza retailers for home delivery services. He…

A: Given, Two Delivery Services : Current Van and New VanMARR : 12% Current Van : Purchased 10 years…

Q: A young engineer is considering establishing his own small company. An investment of P400,000 will…

A: A rate of return refers to the net gain or the loss of an investment over a certain time period…

Q: A farmer in China is considering three alternative machines. Machine A will cost K18,000. Machine B…

A: Net Present Value (NPV) is a financial metric used to evaluate the profitability of an investment or…

Q: Problem 02.033 - Calculation of unknown gradient For the cash flow revenues shown below, find the…

A: For the cash flow revenues shown below,* The equivalent annual worth in years 1 through 7 equal to…

Q: Required Information An Investment broker that Ava trusts recommended that she purchase a $50,000,…

A: A bond is classified as a financial instrument that is issued by an organization to raise capital.…

Q: A company is considering the purchase of a fleet of % ton pickup trucks for their contracting…

A: EUAC = NPV/Capital Recovery (Amortization) Factor Now, NPV =…

Q: The Briggs and Stratton Commercial Division designs and manufacturers small engines for golf turf…

A: The company will be indifferent between the Pull system and the Push system if the Present Worth…

Q: Do a Present Worth Analysis to be able to determine the Alternative chosen from the three Generators…

A: Present worth analysis (PWA) is a method used to determine the present value of future money…

Q: What is net future value for a project with MARR 10% and cash flows of: year 0: -200; year 1: $50;…

A: Present value is the value of investment in today's dollar. Future value is the value of investment…

Q: do fast i will 10 upvotes.

A: Sure, let's break down the problem step by step: 1. **Given Parameters**: We are provided with…

Q: The problem A young engineer is considering to built a 1 unit apartment near a commercial center.…

A: A purchase made with the intention of creating income or capital growth is known as an investment.…

Q: Part a Determine the ERR for this project. N 3 4 5 6 % $27 $27 $27 $27 $27

A: To calculate the Economic Rate of Return (ERR) for the given cash flow profile, we need to determine…

Q: QUESTION 4 For the below ME alternatives, which machine should be selected based on the PW analysis.…

A: Salvage value is the book value of an asset after all depreciation has been fully expensed. The…

Q: Company X has $ 938529 in annual fixed costs. The primary product generates $ 7.98 in revenue per…

A: Annual breakeven quantity is that quantity at which total cost is equal to total revenue. It means…

Q: Consider the following cash flow profile and assume MARR is 10%/yr. Solve, a. Determine the ERR for…

A: (a) The formula to compute the economic rate of return is: ERR=Lower discount rate+NPV at lower…

Q: These data were derived from a forest inventory and are to be used to calculate the best (most…

A: To calculate the best rotation (most revenue return), the manager wants to maximize the net income.…

Q: If you have the present worth of an alternative with a 5-year life, you can obtain its annual worth…

A: Time value of money: It refers to the value of money, which is more in the present time than the…

Q: npounded monthly) with a maintenance cost of $75 per month. If the nominal in % per year compounded…

A: Answer The correct answer is 'option c' i.e., 12.8 years. Breakeven period for the two option…

Q: An iron ore of 50x10^6 ton was produced during 15 years and has been sold for $100 per ton Estimate…

A: The Net Present Value, or NPV, of a project over its lifetime is the sum of its present values of…

Question

From the data shown, determine the ESL of the equipment assuming MARR of 15%.
Years Retained Market Value M&O Cost
$28,000
$24,000
$22,000
$20,000
$15,000
$48,000
-$49,000
$50,000
2.
-$51,000
ESL = 1 year
O None of the above
ESL = 3 years
O ESL = 4 years
ESL = 2 years

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

5. The physical life is always greater than all the other "life" factors under replacement analysis. 6. If breakeven analysis is conducted with PW analysis for different MEAS, it doesn't guarantee that the fastest alternative to reach its breakeven point has also the highest equivalent worth.
An equipment is bought for $9,000 and sold at the end of its service life for $800. If the service period is 10 years and the MARR is 10%, then the minimum annual savings that this equipment must yield for it to break even is closest to? a) $1,414 b) $1,701 c) $1,312 O d) $1,514
2 DFrom the graph above, calculate the MPS for the saving function
A company is considering purchasing either machine A or B, given that MARR is 10%, and the company projected sales is 40,000 units. Machine A Machine B $90,000 $39,000 $1100 +.02xunits $600 +0.03xunits Initial cost $70,000 $40,000 $1000+0.03xunit $500+0.05xunit 8 years $15,000 Annual revenues Annual Operation cost Annual Maintenance cost 6 years $10,000 Life span Salvage value Draw the cash fiow diagram for each machine. a. b. Compute ERR for each machine, based on computed ERRS, which machine is to be selected7 Explain the difference between the IRR & ERR methods as explained in the lecture.
Given the following information about possible investments and a MARR of 15% per year. Alternative A Investment Cost Annual Benefits Useful Life P250,000 P60,000 5 years a.) Which alternative is preferred, based on the LCM method? b.) Which alternative is preferred using a five-year study period. Alternative B P400,000 P40,000 P15 years
A piece of construction equipment will cost $6,000 new and will have an expected life of 8 years, with no salvage value at the end of its life. The disbursements for taxes, insurance, maintenance, fuels, and lubricants are estimated to be $1,500 for the first two years, $1,700 for the third, $1,900 for the fourth, and will continue to increase by $200 each year thereafter. a) Draw a fully labelled diagram to represent this cash flow. b) What is the equivalent Future Cost (FW) of this piece of equipment if the rate of interest is 12%?
Question 1 A design firm is considering multiple independent projects for the upcoming quarter. For a MARR of 6.5% per quarter. What is your recommendation to the company based on a PW analysis? Project Initial Payment Monthly Costs (Today) A $1,500,000 $170,000 B $245,000 $200,000 C $300,000 $150,000 Payments are inflows for the design firm. Costs are outflows for the design firm. Payment at month 12 of $1,000,000 Costs at month 9 of $100,000 None Final Payment (At end of project) $3,000,000 Project Length Other Cash flows 2 years $3,000,000 18 months $4,000,000 30 months
An investment proposal calls for $223,130 payment now and a second $259,450 7 years from now. The investment is for a project with perpetual life. The annual interest rate is 6%. What is the approximate capitalized cost?
A4 Please complete the things I have not filled out. I believe the best way to complete this is using excel. Also make sure to do the part that says to perform the incremental IRR analysis for the remaning alternatives (The part that has The IRR delta (C - A = ?? %). Thank You!
Pls help ASAP
Question 7 for th below two machines and based on CC analysis which machine we should select? MARR=10%. Machine A Machine B First cost, $ Annual cost, $/year Salvage value, $ Life, years 25,640 100,000 11,114 7,000 5,483 3 infinite Answer the below question: A- the CC for machine A=
Given the following two mutually exclusive alternatives and using repeatability assumption, the correct equation for computing the CW of alternative B is. MARR-15% / year. Capital Investment, $ Market value, $ Annual Expenses, $ Useful life (years) Alternative A -12.000 0 -2,200 10 O CW(15%)-(-40,000-100-(P/A, 15%, 25)+10000(P/F, 15 %. 25))*0.15 O CW(15 %)-(-40,000(A/P. 15%, 25)-1000+10,000(A/F. 15%, 25))/0.15 OCW(15%) - (-40,000(A/P. 15%, 25)-1000+10,000(A/F, 15%, 25))*0.15 OCW(15%)-(-40,000-100-(P/A, 15%, 25 ) +10000 (P/F, 15%, 25))"0.15 Alternative B -40.000 10,000 1,000 25