Solve by incremental cashflow then PW = 0. To get the value of i by interpolation.Problem 3:Two plans for a hydroelectric project in Peru have been proposed. The opportunitycost, in soles, of resources is 10 percent. Data on the two alternatives are:SystemFirst cost ($/,000,000,000)300160Economic life (years)4020Salvage value ($/,000,000,000)1512Annual benefits (S/.000,000,000)2522Annual costs ($/,000,000,000)31Using the internal rate of return method, which of the two systems should be chosenor should either be selected?

Internal rate of return (IRR) refers to the discount rate of a project wherein its net present value…

Problem 3: Two plans for a hydroelectric project in Peru have been proposed. The opportunity cost, in soles, of resources is 10 percent. Data on the two alternatives are: System First cost ($/,000,000,000) Economic life (years) Salvage value ($/.000,000,000) 300 160 40 20 15 12 25 22 3 1 Annual benefits (S/.000,000,000) Annual costs ($/,000,000,000) Using the internal rate of return method, which of the two systems should be chosen or should either be selected?

Problem 3: Two plans for a hydroelectric project in Peru have been proposed. The opportunity cost, in soles, of resources is 10 percent. Data on the two alternatives are: System First cost ($/,000,000,000) Economic life (years) Salvage value ($/.000,000,000) 300 160 40 20 15 12 25 22 3 1 Annual benefits (S/.000,000,000) Annual costs ($/,000,000,000) Using the internal rate of return method, which of the two systems should be chosen or should either be selected?

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

1.) What are the 3 assumptions that must be considered when using the LCM approach in comparing PW of differentlife alternatives? Question 2 in image, thank you.
Q1).Using AW method compare between the following alternatives: Operating and maintenance Alt. F.C. Income at the Annual nd S.V. Useful life i. end of 2 yearIncome A 35000 3500 2800 7000 8 8% B. 32000 1500 4700 2500 8%
A series of alternative projects have the following series of discount annualized costs and benefits. Which project is your best choice? What is your second-best choice? Please list your calculation details. Project Alternative A B C D E Present Value of Benefits 100 160 90 70 180 Present Value of Costs 60 90 40 30 120
1. Which of the following vectors represent a simple lottery? Which represent a degenerate lottery? (a) (0,1,0,0,0, 0) (b) (}, 2,0, , 1) (c) (? (d) (0,1) (e) (0, 3, 0) 6. 5, 4 1 1 3' 3' 3' 3
None
which process line should be built for a new chemical? the expected market for the chemical is 16 years. an 18% rate is used to evaluate new process facilities, which are compared with present worth. how much does the better choice save? First cost O &M cost/year salvage life A $14 M $2.5 M $2 M 8 years B 22 M 3 M 7.5 M 16 years