QUESTION 1 A new production system for a factory is to be purchased and installed for $163,086. This system will save approximately 300,000 kWh of electric power each year for a 6-year period. Assume the cost of electricity is $0.10 per kWh, and factory MARR is 15% per year, and the salvage value of the system will be $8,432 at year 6. Using the PW method to analyzes if this investment is economically justified A calculate the PW of the above investment and insert the result below.

QUESTION 1 A new production system for a factory is to be purchased and installed for $163,086. This system will save approximately 300,000 kWh of electric power each year for a 6-year period. Assume the cost of electricity is $0.10 per kWh, and factory MARR is 15% per year, and the salvage value of the system will be $8,432 at year 6. Using the PW method to analyzes if this investment is economically justified A calculate the PW of the above investment and insert the result below.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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