Q6/ The purchase price of a natural gas-fired commercial boiler (capacity X) was $180000 eight years ago. Another boiler of the same basic design, except with capacity 1.42X, is currently being considered for purchase. If it is purchased, some optional features presently costing $25000 would be added for your application. If the cost index was 160 for this type of equipment when the capacity X boiler was purchased and is 220 now, and the applicable cost capacity factor is 0.8, what is your estimate of the purchase price for the new boiler?
Q6/ The purchase price of a natural gas-fired commercial boiler (capacity X) was $180000 eight years ago. Another boiler of the same basic design, except with capacity 1.42X, is currently being considered for purchase. If it is purchased, some optional features presently costing $25000 would be added for your application. If the cost index was 160 for this type of equipment when the capacity X boiler was purchased and is 220 now, and the applicable cost capacity factor is 0.8, what is your estimate of the purchase price for the new boiler?
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
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Transcribed Image Text:Q6/ The purchase price of a natural gas-fired commercial boiler (capacity X) was $180000
eight years ago. Another boiler of the same basic design, except with capacity 1.42X, is currently
being considered for purchase. If it is purchased, some optional features presently costing $25000
would be added for your application. If the cost index was 160 for this type of equipment when
the capacity X boiler was purchased and is 220 now, and the applicable cost capacity factor is
0.8, what is your estimate of the purchase price for the new boiler?
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