The capital investment for a new machine is $950,000. The estimated annualexpense, in year zero dollars, is $92,600. This expense is estimated to increase at the rate of5.7% per year (F). Assume that f= 4.5%, N = 7 years, MV at the end of year 7 is 10% of thecapital investment, and the MARR (in real terms) is 10.05% per year. What uniform annualrevenue (before taxes), in actual dollars, would the machine need to generate to break even?

Identify the Problem:We need to determine the annual revenue required for a machine to break even,…

Answered: The capital investment for a new…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The heat loss through the exterior walls of a certain manufacturing plant is estimated to cost $29000 at EOY 1. ABC Insulation, Inc., told the owner of the plant that the heat loss can be reduced by 80% if he is willing to spend $401,000 to install its innovative insulation material. The cost of heat loss is expected to rise by $2100 per year (uniform gradient) after the next year. The owner plans to keep the present building for 15 more years. Assume MARR (minimum acceptable rate of return) is 4% per year. (a) What is the present equivalent value of the cost savings in the reduction of heat loss for these 15 years? Round off your final answer to nearest thousand. (b) Using AW method, would you recommend the owner to install ABC's new insulation material? Why?
CDO City started a Solid Waste Management initiative in partnership with Tetra Pak Philippines and BXTRA Philippines. This project enables Kagayanons to earn cash/environmental points with every 15 pieces 1 liter UBC of any brand. Profits from recycling Used Beverage Containers (UBCS) have increased at a constant rate of Php 1100 in each of the last 3 years. If this year's profit (end of year 1) is expected to be Php 6000 and the profit trend continues through year 5, what will the profit be at the end of year 5? О а. Р 10400 О Б. Р1100 О с. Р7100 O d. P 6000
An integrated, combined cycle power plant produces 285 MW of electricity by gasifying coal. The capital investment for the plant is $570 million, spread evenly over two years. The operating life of the plant is expected to be 20 years. Additionally, the plant will operate at full capacity 75% of the time (downtime is 25% of any given year). The MARR is 6% per year Cash flow diagram only Thank you No need calculation. Please help
Question 5 Costs for maintenance of buildings at an industrial complex are expected to be $1,000 in year three, $1,200 in year four and amounts increasing by $200 per year thereafter through year nine. At an interest rate of 10% per year, what is the present worth of the cash flow? Question 6 You wish to make an investment of $3,000 today, which will become $5,000 at an interest rate if 12% . How many years will it take? Please don't handwriting solution
6
If an investment of BD10,450 will be given in an interest rate of 15% for the period from (January1 to September 30, 2024). What is the value of the exact simple interest and the total payable amount? solve the problem showing cash flow, and final answer using a suitable formula.
The maintenance on a machine is expected to be P6322 for the second year and an additional 1,750 cost every year until year 5. What is the present equivalent value at the beginning of the first year if the interest is 5% per year? Round your answer to 2 decimal places. Add your answer
Chinese economic growth is the outstanding feature of the world economic scene over the past two decades. In 2018, U.S. output was $20.5 trillion, and Chinese output in 2017was $13.5 trillion. Suppose that from 2017, the output of China grows at an annual rate of 7.9% per year, whereas the output of the United States grows from 2018 at an annual rate of 2.2% per year. Using these assumptions and a spreadsheet, calculate and plot U.S. and Chinese output from 2017 or 2018 over the next 50years. The level of U.S. output in 50 years will be The level of Chinese output in 50 years will be $ places.) trillion (Round your response to two decimal places) trillion (Round your response to two decimal How many years will it take for China to have a total level of output equal to that of the United States? A. 4.7 years B. 20.5 years C. 12.6 years D. 6.3 years
3) Find the rate of return (IRR-Ch16.3) on a project that will cost $100,000 today and $400,000 in 3 years from today, BUT will return $50,000 at the end of every year for 11 years (4)
A certain medical device will result in an estimated $15,000 reduction in hospital labor expenses during its first year of operation. Labor expenses (and thus savings) are projected to increase at a rate of 7% per year after the first year. Additional operating expenses for the device (maintenance, electric power, etc.) are $3,500 annually, and they increase by $250 per year thereafter (i.e., $3,750 in year two and so on). It is anticipated that the device will last for 10 years and will have no market value at that time. If the MARR is 10% per year, how much can the hospital afford to pay for this device? Use an Excel spreadsheet in your solution.
Required information Assume that 25 years ago your dad invested $320,000, plus $32,000 in years 2 through 5, and $49,000 per year from year 6 on. Determine the annual retirement amount that he can withdraw forever starting next year (year 26), if the $49,000 annuity stopped at year 25. The interest rate being 14% per year. The annual retirement amount is determined to be $

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