Standby power for pumps at water distribution booster stations can be provided by either gasolineor diesel-powered engines. The estimates for the gasoline engines are as follows: Gasoline First cost, $ −150,000 M&O, $ per year −41,000 Salvage value, $ 23,000 Life, years 15 If the incremental PW-based ROR equation associated with (Diesel – Gasoline) is 0 = – 40,000 + 11,000(P∕A,Δi*,15) + 16,000(P∕F,Δi*,15), the first cost of the diesel engine is closest to: (a) –190,000 (b) –110,000 (c) –60,000 (d) – 40,000
Standby power for pumps at water distribution booster stations can be provided by either gasolineor diesel-powered engines. The estimates for the gasoline engines are as follows: Gasoline First cost, $ −150,000 M&O, $ per year −41,000 Salvage value, $ 23,000 Life, years 15 If the incremental PW-based ROR equation associated with (Diesel – Gasoline) is 0 = – 40,000 + 11,000(P∕A,Δi*,15) + 16,000(P∕F,Δi*,15), the first cost of the diesel engine is closest to: (a) –190,000 (b) –110,000 (c) –60,000 (d) – 40,000
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Standby power for pumps at water distribution
booster stations can be provided by either gasolineor
diesel-powered engines. The estimates for the
gasoline engines are as follows:
Gasoline
First cost, $ −150,000
M&O, $ per year −41,000
Salvage value, $ 23,000
Life, years 15 If the incremental PW-based ROR equation associated
with (Diesel – Gasoline) is 0 = – 40,000 +
11,000(P∕A,Δi*,15) + 16,000(P∕F,Δi*,15), the
first cost of the diesel engine is closest to:
(a) –190,000
(b) –110,000
(c) –60,000
(d) – 40,000
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