Infrared thermometers by Delta Thermal Products are compatible with type K thermocouples and can provide rapid non-contact measurement capabilities at a cost of $135 per unit. A small private electric utility company plans to purchase 100 of the thermometers now and 500 more 1 year from now, if the anticipated savings in labor costs can be realized. At an interest rate of 12% per year, what is the equivalent annual worth of the savings over a study period of years 1 through 5 that justifies the equipment purchases?
Infrared thermometers by Delta Thermal Products are compatible with type K thermocouples and can provide rapid non-contact measurement capabilities at a cost of $135 per unit. A small private electric utility company plans to purchase 100 of the thermometers now and 500 more 1 year from now, if the anticipated savings in labor costs can be realized. At an interest rate of 12% per year, what is the equivalent annual worth of the savings over a study period of years 1 through 5 that justifies the equipment purchases?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Infrared thermometers by Delta Thermal Products are compatible with type K thermocouples and can provide rapid non-contact measurement capabilities at a cost of $135 per unit. A small private electric utility company plans to purchase 100 of the thermometers now and 500 more 1 year from now, if the anticipated savings in labor costs can be realized. At an interest rate of 12% per year, what is the equivalent annual worth of the savings over a study period of years 1 through 5 that justifies the equipment purchases?
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