Which process line should be built for a new chemical? The expected market for the chemical is 20 years. A 6% rate is used to evaluate new process facilities, which are compared with present worth. How much does the better choice save? Option First Cost Salvage Life 1 2 $15 M $20 M O&M Cost/Year $5 M $3 M $4 M $6 M 10 years 20 years

Which process line should be built for a new chemical? The expected market for the chemical is 20 years. A 6% rate is used to evaluate new process facilities, which are compared with present worth. How much does the better choice save? Option First Cost Salvage Life 1 2 $15 M $20 M O&M Cost/Year $5 M $3 M $4 M $6 M 10 years 20 years

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1. Find the breakeven market value.2. Find the breakeven annual expense.3. Is the decision more sensitive to changes in market value or annual expense? How doyou know?
M2
S Required information A remotely located air sampling station can be powered by solar cells or by running an above ground electric line to the site and using conventional power. Solar cells will cost $16,800 to install and will have a useful life of 5 years with no salvage value. Annual costs for inspection, cleaning, and other maintenance issues are expected to be $2,900. A new power line will cost $24,500 to install, with power costs expected to be $1,000 per year. Since the air sampling project will end in 5 years, the salvage value of the line is considered to be zero. NOTE: This is a multi-part question. Once an answer is submitted, you will be unable to return to this part. At an interest rate of 10% per year and using an AW analysis, which alternative should be selected? The annual worth of installing solar cells is $- a new power line is $- The alternative to be selected is (Click to select) and the annual worth of installing
A city is planning to renovate their current facility with hi-tech computerized systems. Four plans are proposed by the engineers. Each plan will save $950,000 annually but their cost is different. The benefits will last for 30 years. Based on a benefit-cost analysis what should the agency do, if i = 10%? Initial Cost Annual O & M A $7,250,000 $90,000 B D E F C $6,000,000 $6,500,000 $7,500,000 $8,000,000 $5,500,000 $110,000 $140,000 $80,000 $150,000 $60,000 FOCUS
1.) What are the 3 assumptions that must be considered when using the LCM approach in comparing PW of differentlife alternatives? Question 2 in image, thank you.
For the project with cash flow given below find the most sensitive factor among annual benefit, annual cost and salvage value if the changes by ±20%. Initial investment Annual revenue Annual Cost Salvage Value MARR Life in years Project Rs.2,00,000 Rs.1,00,000 Rs. 40,000 Rs. 50,000 10% 5
You have been asked to perform a sensitivity analysis on a plant modernization plan. The initial investment is $30,000. Expected annual savings is $13,000. Salvage value is $7,000 after a 7 year planning horizon. The MARR is 12%. Determine the AW if the annual savings change by the following percentages from the initial estimate: b. -80%c. -60%d. -40%e. -20%f. +20%g. +40%h. Determine the percentage change in net annual savings that causes a reversal in the decision regarding the attractiveness of the project
Solve using Excel. Show your formula.
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Without using excel
which process line should be built for a new chemical? the expected market for the chemical is 16 years. an 18% rate is used to evaluate new process facilities, which are compared with present worth. how much does the better choice save? First cost O &M cost/year salvage life A $14 M $2.5 M $2 M 8 years B 22 M 3 M 7.5 M 16 years