Light emitting diode (LED) light bulbs have become required in recent years, but do they make financial sense? Suppose a typical 60-watt incandescent light bulb costs $.50 and lasts for 1,000 hours. A 15-watt LED, which provides the same light, costs $3.65 and lasts for 12,000 hours. A kilowatt-hour is 1,000 watts for 1 hour. Suppose you have a residence with a lot of incandescent bulbs that are used on average 500 hours a year. The average bulb will be about halfway through its life, so it will have 500 hours remaining (and you can't tell which bulbs are older or newer). If you require a return of 9 percent, at what cost per kilowatt-hour does it make sense to replace your incandescent bulbs today? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 6 decimal places, e.g., 32.161616.) Break-even cost
Light emitting diode (LED) light bulbs have become required in recent years, but do they make financial sense? Suppose a typical 60-watt incandescent light bulb costs $.50 and lasts for 1,000 hours. A 15-watt LED, which provides the same light, costs $3.65 and lasts for 12,000 hours. A kilowatt-hour is 1,000 watts for 1 hour. Suppose you have a residence with a lot of incandescent bulbs that are used on average 500 hours a year. The average bulb will be about halfway through its life, so it will have 500 hours remaining (and you can't tell which bulbs are older or newer). If you require a return of 9 percent, at what cost per kilowatt-hour does it make sense to replace your incandescent bulbs today? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 6 decimal places, e.g., 32.161616.) Break-even cost
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Light emitting diode (LED) light bulbs have become required in recent years, but do they
make financial sense? Suppose a typical 60-watt incandescent light bulb costs $.50 and
lasts for 1,000 hours. A 15-watt LED, which provides the same light, costs $3.65 and lasts
for 12,000 hours. A kilowatt-hour is 1,000 watts for 1 hour. Suppose you have a residence
with a lot of incandescent bulbs that are used on average 500 hours a year. The average
bulb will be about halfway through its life, so it will have 500 hours remaining (and you
can't tell which bulbs are older or newer). If you require a return of 9 percent, at what
cost per kilowatt-hour does it make sense to replace your incandescent bulbs today? (A
negative answer should be indicated by a minus sign. Do not round intermediate
calculations and round your answer to 6 decimal places, e.g., 32.161616.)
Break-even cost
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