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Using the cost data for Project X and Project Y below, conduct a Present Worth Analysis to calculate the Present Worth of Project X at time 0 over LCM years of the life of both X and Y. Given 8% per year interest rate. X First Cost -60,000 Annual Cost -12,000 Salvage Value Life 5,000 10 Y -150,000 -7,000 80,000 Infinity

Using the cost data for Project X and Project Y below, conduct a Present Worth Analysis to calculate the Present Worth of Project X at time 0 over LCM years of the life of both X and Y. Given 8% per year interest rate. X First Cost -60,000 Annual Cost -12,000 Salvage Value Life 5,000 10 Y -150,000 -7,000 80,000 Infinity

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Using exactly the same information from Problem No. 1 above, calculate the Annual Worth of Project X at 8% per year interest rate. You can see the data in picture 1, please answer this problem asap. Thank you for your help.

### Present Worth Analysis of Projects X and Y Using the cost data for Project X and Project Y below, conduct a Present Worth Analysis to calculate the Present Worth of Project X at time 0 over the Least Common Multiple (LCM) years of the life of both X and Y. Given an 8% per year interest rate. #### Project Data | Attribute | Project X | Project Y | |----------------|-----------|-----------| | **First Cost** | -60,000 | -150,000 | | **Annual Cost**| -12,000 | -7,000 | | **Salvage Value** | 5,000 | 80,000 | | **Life** | 10 | Infinity | - **First Cost**: Initial investment required for the project. - **Annual Cost**: Ongoing annual expenditure. - **Salvage Value**: The estimated residual value at the end of the project life. - **Life**: Duration of the project's operation (in years). This analysis helps in comparing and evaluating the viability of both projects based on the present worth of their cash flows over the specified time frame, accounting for the interest rate.
Transcribed Image Text:### Present Worth Analysis of Projects X and Y Using the cost data for Project X and Project Y below, conduct a Present Worth Analysis to calculate the Present Worth of Project X at time 0 over the Least Common Multiple (LCM) years of the life of both X and Y. Given an 8% per year interest rate. #### Project Data | Attribute | Project X | Project Y | |----------------|-----------|-----------| | **First Cost** | -60,000 | -150,000 | | **Annual Cost**| -12,000 | -7,000 | | **Salvage Value** | 5,000 | 80,000 | | **Life** | 10 | Infinity | - **First Cost**: Initial investment required for the project. - **Annual Cost**: Ongoing annual expenditure. - **Salvage Value**: The estimated residual value at the end of the project life. - **Life**: Duration of the project's operation (in years). This analysis helps in comparing and evaluating the viability of both projects based on the present worth of their cash flows over the specified time frame, accounting for the interest rate.
Using exactly the same information from Problem No. 1 above, calculate the Annual Worth of Project X at 8% per year interest rate. - Options provided for the calculation result: - -19,764 - -20,597 - -21,892 - -18,790
Transcribed Image Text:Using exactly the same information from Problem No. 1 above, calculate the Annual Worth of Project X at 8% per year interest rate. - Options provided for the calculation result: - -19,764 - -20,597 - -21,892 - -18,790
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