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2. Fill in the blank your numeric answer for each of the following question. 1. A machine with a first cost of $25,000 is expected to have a $5,000 salvage value after its five-year depreciable life. The depreciation charge by the straight-line method for year three is closest to:

2. Fill in the blank your numeric answer for each of the following question. 1. A machine with a first cost of $25,000 is expected to have a $5,000 salvage value after its five-year depreciable life. The depreciation charge by the straight-line method for year three is closest to:

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
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2. Fill in the blank your numeric answer for each of the following question. 1. A machine with a first cost of $25,000 is expected to have a $5,000 salvage value after its five-year depreciable life. The depreciation charge by the straight-line method for year three is closest to: 2. An alternative for manufacturing a certain part has a first cost of $50,000, an annual cost of $10,000, and a salvage value of $5,000 after its 10-year life. At an interest rate of 10% per year, the capitalized cost of the alternative is closest to: 3. You are considering an investment that costs $2,000. It is expected to have a useful life of 3 years. You are very confident about the revenues during the first and the third year, but you are unsure about the revenue in year 2. If you hope to make at least a 10% rate of return on your investment ($2,000), what should be the minimum revenue in year 2: Year Cash Flow 0 -$2000 1 $1000 2 X 3 $1200
Transcribed Image Text:2. Fill in the blank your numeric answer for each of the following question. 1. A machine with a first cost of $25,000 is expected to have a $5,000 salvage value after its five-year depreciable life. The depreciation charge by the straight-line method for year three is closest to: 2. An alternative for manufacturing a certain part has a first cost of $50,000, an annual cost of $10,000, and a salvage value of $5,000 after its 10-year life. At an interest rate of 10% per year, the capitalized cost of the alternative is closest to: 3. You are considering an investment that costs $2,000. It is expected to have a useful life of 3 years. You are very confident about the revenues during the first and the third year, but you are unsure about the revenue in year 2. If you hope to make at least a 10% rate of return on your investment ($2,000), what should be the minimum revenue in year 2: Year Cash Flow 0 -$2000 1 $1000 2 X 3 $1200
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