Engineering Economy, Student Value Edition (17th Edition)
17th Edition
ISBN: 9780134838137
Author: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher: PEARSON
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Chapter 12, Problem 19P
To determine
Calculate the standard deviation.
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Thermtech Science has performed an economic analysis of proposed service in a new region of the country. The three-estimate approach to sensitivity analysis has been applied. The optimistic and pessimistic values each have an estimated 15% chance of occurring. Use the FW values shown to determine the expected FW. Optimistic Most Likely Pessimistic FW value, $ 200,000 40,000 −25,000
An industrial machine costing $10,000 will produce net cash
savings of $4,000 per year. The machine has a five-year useful life
but must be returned to the factory for major repairs after three
years of operation. These repairs cost $5,000. The company's
MARR is 10% per year. What IRR will be earned on the purchase
of this machine? Analyze the sensitivity of IRR to $2,000
changes in the repair cost.
Perform the sensitivity analysis. Fill-in the table below. (Round to
one decimal place.)
Change in
the repair cost
- $2,000
$0
IRR
21.05%
%
Is the project
acceptable?
Yes
Chapter 12 Solutions
Engineering Economy, Student Value Edition (17th Edition)
Ch. 12 - Prob. 1PCh. 12 - Prob. 2PCh. 12 - A new snow making machine utilizes technology that...Ch. 12 - Prob. 4PCh. 12 - Prob. 5PCh. 12 - Prob. 6PCh. 12 - Prob. 7PCh. 12 - Prob. 8PCh. 12 - Prob. 9PCh. 12 - Prob. 10P
Ch. 12 - Prob. 11PCh. 12 - Prob. 12PCh. 12 - Prob. 13PCh. 12 - Prob. 14PCh. 12 - Prob. 15PCh. 12 - Prob. 16PCh. 12 - Prob. 17PCh. 12 - Prob. 18PCh. 12 - Prob. 19PCh. 12 - Prob. 20PCh. 12 - Prob. 21PCh. 12 - Prob. 22PCh. 12 - If the interest rate is 8% per year, what decision...Ch. 12 - Prob. 24PCh. 12 - Prob. 25PCh. 12 - Prob. 26SE
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