Leonard, a company that manufactures explosion-proof motors, is considering two alternatives for expanding its international exportcapacity. Option 1 requires equipment purchases of $740000 now and $440000 two years from now, with annual M&O costsof $66000 in years 1 through 10. Option 2 involves subcontracting some of the production at costs of $240000 per year beginningnow through the end of year 10. Neither option will have a significant salvage value. Use a present worth analysis to determine whichoption is more attractive at the company's MARR of 18.00% per year. (Include a minus sign if necessary.)The present worth of option 1 is $Option (Click to select) is more attractive.(Click to select)21and that of option 2 is $

Given DataMARR (Minimum Acceptable Rate of Return): 18% (or 0.18)Years: 10Option 1 Calculations1.…

Answered: Leonard, a company that manufactures…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The monthly demand for ice cream cans being manufactured by Mr. Rivera is 3,200 pcs.With a manually operated guillotine the unit cutting cost is Php 50.00. An electricallyoperated hydraulic guillotine was offered to him at a price of Php 300,000 and whichreduced by 30% the unit cutting cost. Disregarding the cost of money, how manymonths will Mr. Rivera be able to recover the cost of the machine if he decides to buynow? Engineering Economics
Smith Equipment has three separate shipments to customers all in the same city. The shipment welights are 20,000 Ibs. 25,000 bs, and 10,000 ibs. Smith Equipment's carrier charges $14 per hundredwelght (cwt) if each shipment is sent separately. If the three shipments are consolidated at Smith Equipment's warehouse and sent in a single truck, the carrier charges $11 per cwt with a $500 consolldated dellvery fee per destination added. Assume the carrler promises one-day delivery on the separate shipments, and two-day dellvery on the consoldated shipment. If shorter delivery time is important to these customers, Smith Equipment should Multiple Choice O consolidate the shipments because the savings is substantial O consolidate the shipments even though the savings are minimal send the shipments separately even though this is asightly more expensive option send the shipments separately even though this is a significantly more expensive option
Answer is 7.322 don't know how?
polarization 5. Handheld fiber-optic meters with white light interferometry are useful for measuring temperature, pressure, and strain in electrically noisy environments. The fixed costs associated with manufacturing are Php40M per year. If a base unit sells for Php180k and its variable cost is Php120k, A. how many units must be sold each year for breakeven and B. what will the profit be for sales of 3000 units per year?
THE SOLUTION OF THE PROBLEM IS VERY IMMEDIATE IMMEDIATELY NEEDED
2
An industrial firm is considering purchasingseveral programmable controllers and automatingthe company’s manufacturing operations. It is estimated that the equipment will initially cost $120,000,and the labor to install it will cost $25,000. A servicecontract to maintain the equipment will cost $5,000per year. Trained service personnel will have to behired at an annual salary of $50,000. Also estimatedis an approximate $10,000 annual income-tax savings (cash inflow). How much will this investment inequipment and services have to increase the annualrevenues after taxes in order to break even? Theequipment is estimated to have an operating life of10 years with no salvage value because of obsolescence. The firm’s MARR is 12%
not use ai please
A sheltered workshop requires a lift truck to handle pallets for a new contract. A lift truck can be purchased for Rs.2,70,000. Annual insurance costs are 3% of the purchase price, payable on the first of each year, an equivalent truck can be rented for Rs,15,000 per month payable at the end of each month. Operating costs are same for both the alternatives. For what minimum number of months must a purchased truck be used on the contract to make purchasing more attractive than leasing? Interest rate is 12% compounded monthly. Assume that the purchased truck has no salvage value. Solve using Formulas and draw cash flow diagram.
A new trailer worth $17,500 is purchased and it's expected that the salvage value after 10 years will be $750. If the interest rate is 4%, what equation would be appropriate to use to determine the Expected Uniform Annual Cost (EUAC)? O A = P(A/P, i, n) - F(P/F, i, n) O A = P(A/P, i, n) - F/n %3D O A -P+F O A - PIA/P, i, n) - F(A/F, i, n)
For a motor to operate a pump, a design engineer must choose the horsepower. Horsepower rating is a design characteristic that can vary from 10 to 40 horsepower. The motor will cost $120 per year to operate, plus $0.60 per horsepower. The running expenses of such motors will be $0.055 per horsepower-hour divided by the horsepower rating. Each year, 9,000 horsepower-hours will be required. Determine how much horsepower should be supplied to keep the overall yearly cost to a minimal. Demonstrate that your entire cost each year has been reduced.
Oregon Ducks, Inc. is considering buying licenses for 12 megahertz of wireless spectrum in the 700 MHz range, which is suitable for delivering television to mobile phones. The 700 MHz signals can travel long distances and more easily penetrate walls and other obstacles. The acquisition cost is $300 million. In addition, because networks that operate in the 700 MHz range are less expensive to build than those in other portions of the spectrum, Ducks estimates annual costs of $24 million over the next 9 years and no salvage value. During the same period, the company expects to generate annual revenue of $40 million by offering television and video to mobile-phone users. Calculate the net present worth of this investment if the company's minimum attractive rate of return (discount rate) is 13% per year.

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