Ridgley Custom Metal Products (RCMP) must purchase a new tube bender. RCMP'S MARR is 14 percent. The company is considering three models:ModelTAXFirst Cost$90,000$140,000$190,000Economic Life6 years6 years5 yearsYearly Net Savings$50,000$80,000$85,000Using the annual worth method, which of the three tube benders should RCMP buy?Click the icon to view the table of compound interest factors for discrete compounding periods when i = 14%.The annual worth of Model T is $ The annual worth of Model A is $ .The annual worth of Model X is $(Round to the nearest cent as needed.)So, the Modelis the better choice to buy.Salvage Value$25,000$25,000$75,000

Annual Worth Analysis for Tube BendersWe'll calculate the annual worth of each model and choose the…

Answered: Ridgley Custom Metal Products (RCMP)…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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9. Margaret has a project with a $28 000 first cost that returns $5000 per year over its 10-year life. It has a salvage value of $3000 at the end of 10 years. If the MARRis 15 percent, whatis the annual worth of this project?
Ridgley Custom Metal Products (RCMP) must purchase a new tube bender. RCMP's MARR is 13 percent. The company is considering three models: Economic Life 5 years 5 years 3 years Using the annual worth method, which of the three tube benders should RCMP buy? Model T A X First Cost $120,000 $170,000 $210,000 Yearly Net Savings $50,000 $80,000 $85,000 Salvage Value $20,000 $25,000 $80,000 Click the icon to view the table of compound interest factors for discrete compounding periods when i = 13%. The annual worth of Model T is $ The annual worth of Model A is $ The annual worth of Model X is So, the Model $ is the better choice to buy. (Round to the nearest cent as needed.)
Question 1 Due to health reasons, Dave is considering early retirement. He currently has $700,000 in a self- managed retirement fund. He thinks he will need S40,000 per year during retirement. He intends to invest his retirement in a low-risk mutual fund which return 1.5% per year. How many years can he live off this retirement fund without the need to look for a job?
Margaret has a project with a $28 000 first cost that returns $5000 per year over its 10-year life. It has a salvage value of $3000 at the end of 10 years. If the MARR is 15 percent, what is the annual worth of this project?
Appledale Dairy is considering upgrading an old ice-cream maker. Moderate upgrading costs $7050 now and yields annual savings of $4800 in the first year, and decreases by $300 dollars every year after that. If the upgraded ice-cream maker will last for seven years, what is the present worth of the upgrading option? Use a present worth comparison. Appledale's MARR is 9 percent.
None
QUESTION 1 IC OM B D Life/years $420,000 $45,000 $110,000 $20,000 10 Z $540,000 $35,000 $260,000 $45,000 20 W $500,000 $50,000 $80,000 $10,000 10 $200,000 $20,000 $180,000 $30,000 20 $250,000 $40,000 $90,000 $10,000 15 based on the above ME alternatives and using the B/C analysis, which alternative we should select ? i=10%. X Y Z W V
Use annunal worth !!!
IC OM B D X Life/years Y Z $320,000 $340,000 $45,000 $35,000 $110,000 $210,000 $20,000 $25,000 10 20 W V $400,000 $200,000 $50,000 $20,000 $70,000 $180,000 $10,000 $30,000 10 20 $500,000 $50,000 $80,000 $20,000 15 Based on the the above ME alliterative and using the B/C analyses, which alternative we should select? 10% OX OY OZ OW OV
Galvanized Products is considering purchasing a new computer system for their enterprise data management system. The vendor has quoted a purchase price of $100,000. Galvanized Products is planning to borrow one-fourth of the purchase price from a bank at 16 percent compounded annually. The loan is to be repaid using equal annual payments over a 3-year period. The computer system is expected to last 5 years and has a salvage value of $3,000 at that time. Over the 5-year period, Galvanized Products expects to pay a technician $20,000 per year to maintain the system but will save $50,000 per year through increased efficiencies. Galvanized Products uses a MARR of 14 percent/year to evaluate investments. Using the ERR method, should the new computer system be purchased? (A) Yes B) No

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