Contemporary Engineering Economics (6th Edition)
Contemporary Engineering Economics (6th Edition)
6th Edition
ISBN: 9780134105598
Author: Chan S. Park
Publisher: PEARSON
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Chapter 5, Problem 23P

(a):

To determine

Calculate the resent worth.

(b):

To determine

Calculate the project balance.

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Consider a palletizer at a bottling plant that has a first cost of $260,000, operating and maintenance costs of $17,500 per year, and an estimated net salvage value of $35,000 at the end of thirty years. Assume an interest rate of 5%. a) What is the present equivalent cost of the investment if the planning horizon is thirty years? b) What is the future equivalent cost of the investment if the planning horizon is thirty years? c) What is the annual equivalent cost of the investment if the planning horizon is thirty years
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