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K An oil refinery finds that it is necessary to treat the waste liquids from a new process before discharging them into a stream. In-house treatment will have an annual cost of $20,000 the first year, but process improvements will allow the annual cost to decline by $2,000 each subsequent year. As an alternative, an outside company will process the wastes for an initial cost of $12,600 and an annual fixed price of $10,600/year throughout the 14 year period. Either way, there is no need to treat the wastes after 14 years. Using the AW method, calculate the equivalent uniform annual cost (EUAC) of each alternative and determine how the waste should be processed. The company's MARR is 6% Click the icon to view the interest and annuity table for discrete compounding when the MARR is 6% per year. The EUAC for in-house treatment is $ (Round to the nearest dollar as positive cash flow.) The EUAC for outside treatment is $ (Round to the nearest dollar as positive cash flow.) The most economical alternative is OA. outside treatment OB. in-house treatment 13 iz HP System Events

K An oil refinery finds that it is necessary to treat the waste liquids from a new process before discharging them into a stream. In-house treatment will have an annual cost of $20,000 the first year, but process improvements will allow the annual cost to decline by $2,000 each subsequent year. As an alternative, an outside company will process the wastes for an initial cost of $12,600 and an annual fixed price of $10,600/year throughout the 14 year period. Either way, there is no need to treat the wastes after 14 years. Using the AW method, calculate the equivalent uniform annual cost (EUAC) of each alternative and determine how the waste should be processed. The company's MARR is 6% Click the icon to view the interest and annuity table for discrete compounding when the MARR is 6% per year. The EUAC for in-house treatment is $ (Round to the nearest dollar as positive cash flow.) The EUAC for outside treatment is $ (Round to the nearest dollar as positive cash flow.) The most economical alternative is OA. outside treatment OB. in-house treatment 13 iz HP System Events

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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K An oil refinery finds that it is necessary to treat the waste liquids from a new process before discharging them into a stream. In-house treatment will have an annual cost of $20,000 the first year, but process improvements will allow the annual cost to decline by $2,000 each subsequent year. As an alternative, an outside company will process the wastes for an initial cost of $12,600 and an annual fixed price of $10,600/year throughout the 14 year period. Either way, there is no need to treat the wastes after 14 years. Using the AW method, calculate the equivalent uniform annual cost (EUAC) of each alternative and determine how the waste should be processed. The company's MARR is 6% Click the icon to view the interest and annuity table for discrete compounding when the MARR is 6% per year. The EUAC for in-house treatment is $ (Round to the nearest dollar as positive cash flow.) The EUAC for outside treatment is $ (Round to the nearest dollar as positive cash flow.) The most economical alternative is OA. outside treatment OB. in-house treatment 13 iz HP System Events
Transcribed Image Text:K An oil refinery finds that it is necessary to treat the waste liquids from a new process before discharging them into a stream. In-house treatment will have an annual cost of $20,000 the first year, but process improvements will allow the annual cost to decline by $2,000 each subsequent year. As an alternative, an outside company will process the wastes for an initial cost of $12,600 and an annual fixed price of $10,600/year throughout the 14 year period. Either way, there is no need to treat the wastes after 14 years. Using the AW method, calculate the equivalent uniform annual cost (EUAC) of each alternative and determine how the waste should be processed. The company's MARR is 6% Click the icon to view the interest and annuity table for discrete compounding when the MARR is 6% per year. The EUAC for in-house treatment is $ (Round to the nearest dollar as positive cash flow.) The EUAC for outside treatment is $ (Round to the nearest dollar as positive cash flow.) The most economical alternative is OA. outside treatment OB. in-house treatment 13 iz HP System Events
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