The company's interest rate (MARR) is 12%. Which extruder should the Styrofoam Company choose? Use Annual Cash Flow Analysis. Given a MARR of 10%, use incremental analysis to determine which of the following alternatives should be selected (if any). Each has an expected life of ten years. Plan 1 2 3 4 Null First Cost $220,000 $100,000 $265,000 $180,000 $0 Annual Benefit 39,000 15,000 51,000 26,000

The company's interest rate (MARR) is 12%. Which extruder should the Styrofoam Company choose? Use Annual Cash Flow Analysis. Given a MARR of 10%, use incremental analysis to determine which of the following alternatives should be selected (if any). Each has an expected life of ten years. Plan 1 2 3 4 Null First Cost $220,000 $100,000 $265,000 $180,000 $0 Annual Benefit 39,000 15,000 51,000 26,000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Consider the following analysis of two alternatives, X & Y: YR X Y 0 -200 -1000 1 50 250 2 50 250 3 50 250 4 50 250 5 100 300 The MARR is 10%. Calculate the incremental rate of return in percent to the nearest 0.1 percent.
Two incinerators are being considered by a waste management company. Design A has an initial cost of $2,500,000, has annual operating and maintenance costs of $800,000, and requires overhauls every 5 years at a cost of $1,250,000. Design B is more sophisticated, including computer controls; it has an initial cost of $5,750,000, has annual operating and maintenance costs of $600,000, and requires overhauls every 10 years at a cost of $3,000,000. Using a 5%/year interest rate, determine the capitalized cost for each design and recommend which should be chosen.
If ERR > MARR, then IRR > ERR > MARR. A) True (B) False
If the Savings function is S = -$300 + 0.75Y %3D Then the breakeven level of income is $1200. O True O False
Future worth and annual cash flow analysis often require far less computation than rate of return analysis Select one: True False
None
The MARR is 15%. Three alternatives are available and the associated cash flow is as follow: Year First Cost A B C $1,700 $2,100 $3,750 Annual Benefit Useful Life 2 $1,000 $1,000 $1,000 3 6 Answer the following in this format: 1.23 1. The payback period for Alternative A is 2. The payback period for Alternative B is 3. The payback period for Alternative C is Based on Payback period analysis, Alternative should be selected. (Enter only the letter)
Carlisle Company has been cited and must invest in equipment to reduce stack emissions or face EPA fines of $20,500 per year. An emission reduction filter will cost $75,000 and have an expected life of 5 years. Carlisle's MARR is 10%/year. Part a What is the future worth of this investment? $ Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is £10.
Company X is considering the purchase of a helicopter for connecting services between their base airport and the new inter-county airport being built about 30 miles away. It is believed that the chopper will be needed only for 6 years until the Rapid Transit Connection is phased in. The estimates on two types of helicopters under consideration, The Whirl 2 B and The ROT 8, are given below: The Whirl 2 B First Cost Annual Maintenance Salvage Value Useful life in years $95,000 $3,000 $12,000 The ROT 8 $120,000 $9,000 $25,000 6 3 Assuming that the Whirl 2B will be available in the future with identical costs, what is the annual cost advantage of selecting The Whirl 2B ? (Use an interest rate of 10 %) A. cost more than $4,000 C. cost between $4,000 and $3,000 B. save between $3,000 and $2000 D. save more than $4,000
Most likely estimates for a project are as follows. Choose the correct choice below. MARR Useful life Initial investment Receipts-Expenses (R-E) Determine whether the statement "This project (based upon the most likely estimates) is profitable." is true or false Click the icon to view the relationship between the PW and the percent change in parameter Click the icon to view the interest and annuity table for discrete compounding when the MARR is 15% per year. O False O True 15% per year 6 years $6,500 $1,800/year am