Two 150 horsepower motors are being considered for the company's expansion, as presented in the table below (1 hp = 0.746 kw, Php10 per Kw-hour): Purchase price Useful life Market value Annual operational cost Annual maintenance cost Efficiency MARR Motor A Php 200,000 10 years None 15,000 10,000 80% 10% per year Motor B Php 250,000 10 years 2,500 30,000 5,000 90% How many hours of operations can the company chose either motor A or motor B (the breakeven hours for both motors)? If the motor is to operate for less than and greater than the break-even hours for both motors, which motor should be chosen? Input answers in the succeeding questions.

Two 150 horsepower motors are being considered for the company's expansion, as presented in the table below (1 hp = 0.746 kw, Php10 per Kw-hour): Purchase price Useful life Market value Annual operational cost Annual maintenance cost Efficiency MARR Motor A Php 200,000 10 years None 15,000 10,000 80% 10% per year Motor B Php 250,000 10 years 2,500 30,000 5,000 90% How many hours of operations can the company chose either motor A or motor B (the breakeven hours for both motors)? If the motor is to operate for less than and greater than the break-even hours for both motors, which motor should be chosen? Input answers in the succeeding questions.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Two 150 horsepower motors are being considered for the company's expansion, as presented in the table below (1 hp = 0.746
kw, Php10 per Kw-hour):
Purchase price
Useful life
Market value
Annual operational cost
Annual maintenance cost
Efficiency
MARR
Motor A
Php 200,000
10 years
None
15,000
10,000
80%
10% per year
Motor B
Php 250,000
10 years
2,500
30,000
5,000
90%
How many hours of operations can the company chose either motor A or motor B (the breakeven hours for both motors)? If the
motor is to operate for less than and greater than the break-even hours for both motors, which motor should be chosen?
Input answers in the succeeding questions.

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