You have two machines under consideration for an improved automated wrapping process for Snickers Fun Size candy bars as detailed below. Using an AW analysis, determine which should be selected at i = 15% per year. Machine First cost, $ Annual cost, $/year Salvage value, $ Life, years C -40,000 -10,000 12,000 3 D -65,000 -12,000 25,000 6

You have two machines under consideration for an improved automated wrapping process for Snickers Fun Size candy bars as detailed below. Using an AW analysis, determine which should be selected at i = 15% per year. Machine First cost, $ Annual cost, $/year Salvage value, $ Life, years C -40,000 -10,000 12,000 3 D -65,000 -12,000 25,000 6

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Compare the alternatives below using AW and i = 10% per year D -350,000 -35,000 35,000 ∞ First Cost, $ Annual operating cost, $/year Salvage value, $ Life, years с -150,000 - 10,000 15,000 10
Please no written by hand
A consulting engineering firm is considering two models of SUVs for the company principals. A GM model will have a first cost of $36,000, an operating cost of $4000, and a salvage value of $15,000 after 3 years. A Ford model will have a first cost of $32,000, an operating cost of $3100, and also have a $15,000 resale value, but after 4 years. (a) At an interest rate of 15% per year, which model should the consulting firm buy? Conduct an annual worth analysis. (b) What are the PW values for each vehicle?
Kk.7.
5.24 For the cash flows below, use an annual worth comparison to determine which alternative is best at an interest rate of 1% per month. First cost, $ M&O costs, $/month Overhaul every 10 years, $ Salvage value, $ Life, years X -90,000 -400,000 -30,000 -20,000 - Y 7000 3 - 25,000 10 Z -900,000 -13,000 -80,000 200,000 8
a) Straight Line Method, b) Sinking Fund Method, c) Declining Balance Method, and d) Sum-of- Years Digit (SOYD) Method. First cost = P10,000 %3D Salvage Value = P500 Life of Property = 5 years For sinking fund method, assume 10% interest rate.
A furniture company intends to evaluate whether they want to stick with th equipment (defender) or replace them with the new productive equipment (challenger). The details of the cost required are shown in Table Q3(b) below. Use an interest rate of 20% per year. Items Initial cost eight (8) years ago (RM) Market value (RM) Yearly handling cost (RM) Life time (year) Salvage value (RM) Defender Challenger 450,000 25,000 700,000 160,000 70,000 5 10 50,000 Use the replacement analysis to justify whether the existing equipment is required to be replaced with the new equipment. (ii) If the existing equipment (defender) could be sold in international market, determine how much is the minimum value of the defender so that the challenger could replace the defender now?
The TT Racing and Performance Motor Corporation wish to evaluate two alternative machines for NASCAR motor tune-ups. Machine First cost, $ Annual operating cost, $ per year Life, years Salvage value, $ The better alternative is machine R R > -276,000 -40,000 Use the AW method at 9% per year to select the better alternative. The annual worth of machine R is $- 4 20,500 S 2 -335,500 -50,000 5 17,400 and the annual worth of machine S is $-
1) A ski resort wishes to evaluate two alternative machines for ski and board tuning. Select the best alternative using the AW method at 6% per year. Machine R Machine S Annual operating cost, $ per year -40.000 -50,000 Life, years 3 Salvage value, $ 20.000
A consulting engineering firm is considering two models of SUVs for the company principals. A GM model will have a first cost of $36,000, an operating cost of $4000, and a salvage value of $15,000 after 3 years. A Ford model will have a first cost of $32,000, an operating cost of $3100, and also have a $15,000 resale value, but after 4 years. (a) At an interest rate of 15% per year, which model should the consulting firm buy? Conduct an annual worth analysis. (b) What are the PW values for each vehicle? 10 16 -22)
Dexcon Technologies, Inc., is evaluating two alternatives to produce its new plastic filament with tribological (i.e., low friction) properties for creating custom bearings for 3-D printers. The estimates associated with each alternative are shown below. Using a MARR of 8% per year, which alternative has the lower present worth?
Required information PEMEX, Mexico's petroleum corporation, has an estimated budget for oil and gas exploration that includes equipment for three offshore platforms as shown. Use PW analysis to select the best alternative at a MARR of 16% per year. Platform First cost, $ million Y Z -300 -450 -510 M&O, $ million per year -320 -290 -230 Salvage value, $ million 75 50 90 Estimated life, years 20 20 20 Select platform X, Y, or Z using tabulated factors. The present worth of platform X is $- 2298.4 worth of platform Z is $- 1944.14 million, the present worth of platform Y is $- 2262.15 million, and the present million. The platform selected based on the present worth is platform Z