Moving another question will save this response.Question 3A project with the following costs are under consideration to determine its profitability. Using the IRR comparison, and an annual MARR of 10% compounded semiannually, determine if the project should be executedFirst costSemiannual operating cost$45,000$10,000Semiannual income$20,000Salvage valueLife in yearsOa. IRR = 17% semiannual$20,0004 yearsO b. IRR = 18.7% semiannualO IRR = 16.9% semiannualOd. IRR = 15 3% semiannualMoving to another question will save this response.Question 3 a25 pointsSaveQuestion 3 of 4

Explanation:Option a: This option is incorrect because an IRR of 17% semiannual does not meet the…

Answered: Moving another question will save this…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

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.
Bramble Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows Click here to view PV tables. Machine A $243,000 8 years -0- $80,000 $35,000 Machine B $317,000 8 years -0- $95,000 $40,000 Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. (Round net present value to the
No excel
Retainer 0 1 Expenses 2 Revenue N Years How much can you afford to spend on the first year expenses on a project with the above cash flow?, given; Your MARR is 10.00%, the client has given you a retainer of $5,700, annual revenues are expected to be $2,750, the external rate of return required for this project is 19.5% and the entire project will last 8 years. (Round your answer to the nearest penny)
A $40,000 machine will be purchased by a company whose interest rate is 12% APR, compounded daily. The installation cost is $5.000 and disposal costs are insignificant. If needed, use an MARR to 2 decimal places. Algebraic signs matter! EOY MV(N), $ O&M, $/yr. years 1 30,000 dollars, $ 10,000 2 dollars, $ 24,000 13,500 b. What is the associated EUAC (TAW) for the ESL? 3 21,000 16,000 4 17,500 a. Based on the problem data, what is the economic service life, ESL, of the machine? 17,000 5 10,000 21,000 c. If the machine is kept in service to the ESL calculated in part a, what is the TAW for using the machine in EOY 1?
The wow great expert Hand written solution is not allowed
I just need to understand why it is 195 instead of 856.
Question 10: Consider the following cash flow profile and assume MARR is 12%/year. End of Year 1 2 3 Cash Flow -1000 3400 -5700 3800 a. What does Descartes' rule of signs tell us about the IRR (s) of this project? b. What does the Norstrom's criterion tell us about the IRR (s) of this project? c. Determine the ERR for this project. Is this project economically attractive?
Q4. [ remaining useful life) are shown in the table below. Assume the MARR is 10% per year. Based on this information, - ] The present worth of the cash flows through year k, PWk for a defender (3- year What is the economic life and the related minimum equivalent uniform annual cost, EUAC, for the defender? a. b. Compute marginal cost, show your calculations and fill the table below. Year(k) Total (marginal) cost PWk EUAC -$14,020 -$28,100 3 -$43,075
Machines that have the following costs are under consideration for a new manufacturing process. Compute the Equivalent Annual Worth with an interest rate of 8%, compounded semiannually. The machine last 4 years. First cost $48,000 Semiannual Operating cost: $6,000 Semiannual incomes $14,000 Salvage value: $10,000 a. EAW = $175 Ob. EAW = $2,285 OCEAW=$ 21,745 Od. EAW = $1,958
Nighhigh Newsagent wants to replace its cash register and is currently evaluating two models that seem reasonable. The information on the two alternatives, CR1000 and CRX, is shown in the table. CR1000 $660 $250 $30 in year 1, increasing by $12 each year thereafter 4 years $75 First Cost Annual Savings Annual Maintenance Cost Service Life Scrap value a. If Nighhigh Newsagent's MARR is 10percent, which type of cash register should it choose? Use the present worth method. b. For the less preferred type of cash register found in part (a), what scrap value would make it the preferred choice? Click the icon to view the table of compound interest factors for discrete compounding periods when i = 10%. a. The present worth of the CR1000 is $ (Round to the nearest cent as needed.) The present worth for CRX is $. Nighhigh Newsagent should choose the cash register. CRX $1000 $500 $100 6 years $240
3. A machine with an initial price of $30,000 has an annual operating cost of $15,000 and a life of 4 years. Another machine has a price of $40,000, an annual operating cost of $10,000 and a life of 8 years. At MARR = 10% which machine do you recommend? Use PW factor O Machine 2 O Machine 1

SEE MORE QUESTIONS

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Managerial Economics: A Problem Solving Approach

Economics

ISBN:

9781337106665

Author:

Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:

Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-…

Economics

ISBN:

9781259290619

Author:

Michael Baye, Jeff Prince

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS