Determine the FW of the following engineering project when the MARR is 12% per year. Is the project acceptable? Investment costExpected lifeMarket (salvage) value³Proposal A$9,0006 years- $900Annual receiptsAnnual expenses$7,000$4,000* A negative market value means that there is a net cost to dispose of an asset. To Find PDiscrete Compounding; i=12%Single PaymentCompoundAmountFactorTo Find FPresentWorth FactorCompoundAmountUniform SeriesSinkingPresentFundFactorWorth FactorFactorTo Find FTo Find PTo Find AGiven PGiven FGiven AGiven AGiven FCapitalRecoveryFactorTo Find AGiven PNFIPPIFFIAPIAAIFAIP11.12000.89291.00000.89291.00001.120021.25440.79722.12001.69010.47170.591731.40490.71183.37442.40180.29630.4163456 00 o1.57350.63554.77933.03730.20920.329251.76230.56746.35283.60480.15740.27741.97380.50668.11524.11140.12320.243272.21070.452310.08904.56380.09910.219182.47600.403912.29974.96760.08130.201392.77310.360614.77575.32820.06770.1877540705700177O

Solution Explanation:Step 1: Step 2: Step 3: Step 4:

Answered: Investment cost Expected life Market…

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 PW-based relation for the incremental cash flow series to find A/* between the lower first-cost alternative X and alternative Y has been developed. 0=-38,000+9000(P/A,Ai*,10) + (-2000 (P/F,Ai*,10)) Determine the highest MARR value for which Y is preferred over X. Any MARR value less than % favors Y.
Decision D6, which has three possible choices (X, Y, or Z), must be made in year 3 of a 6-year study period in order to maximize EPW). Using an MARR of 18% per year, the investment required in year 3, and the estimated cash flows for years 4 through 6, determine which decision should be made in year 3. High Low High 06 Low 2 High Low Investment, Cash Flow, (Year Cash Flow, $1000 Cash Flow, Year 31 3) (Year 4) $1000 (Year 5) Cash Flow, $1000 (Year 6) Outcome Probability 3 4 5 6 High (X) $-150,000 $50 $50 $50 0.5 Low (X) $40 $30 $20 0.5 High (Y) $-73,000 $30 $40 $50 0.45 Low (Y) $30 $30 $30 0.55 High (Z) $-240,000 $190 $170 $150 0.7 Low (Z) $-30 $-30 $-30 0.3 The present worth of X is $
The PW-based relation for the incremental cash flow series to find A/* between the lower first-cost alternative X and alternative Y has been developed. 0= -38,000 + 9000 (P/A,Ai *,10) + (-5000(P/F,Ai*,10)) Determine the highest MARR value for which Y is preferred over X. Any MARR value less than % favors Y.
The B&E Cooling Technology Company, a maker of automobile air conditioners, faces an impending deadline to phase out the traditional chilling technique, which uses chlorofluorocarbon (CFCs), a family of refrigerant chemicals believed to attack the earth's protective ozone layer. B&E has been pursuing other means of cooling and refrigeration. As a near-term solution, its engineers recommend a cooling technology known as absorption chiller, which uses plain water as a refrigerant and semiconductors that cool down when charged with electricity. The company plans to retrofit the plant now to adopt the absorption chiller and continuing to be a market leader in cooling technology. B&E is considering three options: The financial data for the three options are as follows: Item Initial investment System life Salvage value Annual revenue Annual operations and maintenance costs Option 1 $6 Million 8 years $1 Million $9 Million $6 Million If B&E's MARR is 15% and using equivalent annual worth…
A corporate jet costs $1,350,000 and will incur $200,000 per year in fixed cost (maintenance, ...) and $277 per hour variable cost (fuel, ..). The jet will be operated 1200 hours per year for 5 years and then sold for $650,000. The jet revenues $1,000 per hour. The MARR is 15% per year. Determine the Capital Recovery (CR) value of the jet.
The capitalized cost (CC) of the given project whose Cash Flow diagram is given below is closest to:
Equipment needed at Valero Corporation refinery for the conversion of corn stock toethanol, a cleaner burning gasoline additive, will cost $175,000 and have net cashflows of $35,000 the first year, increasing by $10,000 per year over the life of 5 years.Develop a spreadsheet chart that plots AW vs interest rate to show where (what interestrate) the project switches from financially justified to unjustified. Use AW as the verticalaxis of the chart, and interest (i) as the horizontal axis of the chart. Use a range ofinterest rates spanning from 10% to 20%, and use increments of 1%. Label both axesand use a title for the chart.
Nadine Chelesvig has patented her invention. She is offering a potential manufacturer two contracts for the exclusive right to manufacture and market her product. Plan A calls for an immediate single lump sum payment to her of $175,000. Plan B calls for an annual payment of $14,000 plus a royalty of $3.90 per unit sold. The remaining life of the patent is 10 years. Nadine uses a MARR of 10%/year. What must be the uniform annual sales volume of the product for Nadine to be indifferent between the contracts, based on an units annual worth analysis? Carry all interim calculations to 5 decimal places and then round your final answer to the nearest unit. The tolerance is ±10.
The capitalized cost (CC) of the given project whose Cash Flow diagram is given below is closest to: = 10% per year 5 6 7 8 9 10 11 2 3 A= $2,000 PO=S30,000 C-55000 (Recurring every 5 y ears) C=55000 (Recurring every 5 years) Captalized Cost= ?
ABC Beverage, LLC, purchases its 355-ml cans in large bulk from Wald-China Can Corporation. The finish on the anodized aluminum surface is produced by mechanical finishing technologies called brushing or bead blasting. Engineers at Wald are switching to more efficient, faster, and cheaper machines to supply ABC. Use the estimates and MARR = 8% per year to select between the two alternatives. Brush Alternative Bead Blasting Alternative P $-400,000 $-400,000 n 6 years large Salvage Value $50,000 no value AOC Nonlabor $-60,000 in year 1, decreasing by $2500 annually starting in year 2 $-70,000 per year
Give typing answer with explanation and conclusion
Based on PW values, determine which of the following independent projects should be selected for investment if $240,000 is available and the MARR is 10% per year. (NCF = net cash flow)

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