Dickinson, a large oil and gas drilling andoperating corporation, has invested over the past6 years in the installation and operation of aFOUNDATION Fieldbus H1 (FF H1) systemdeveloped by Pepperl+Fuchs of Germany. Aproject engineer has collected information onannual net cash flow increases (ΔNCF) generatedby the FF H1 system and the annual investmentsmade by Dickinson in the system. At aninterest rate of 10% per year, determine the PI ofthis endeavor. Has it proven to be economicallyworthwhile? (Note: Problem 9.54 explores thefieldbus implementation further using aspreadsheet.) Year 0 1 2 3 4 5 6 ΔNCF, $10,000 per year 0 5 7 9 11 13 20 Investment, $10,000 15 8 10 0 0 5 10
Dickinson, a large oil and gas drilling and
operating corporation, has invested over the past
6 years in the installation and operation of a
FOUNDATION Fieldbus H1 (FF H1) system
developed by Pepperl+Fuchs of Germany. A
project engineer has collected information on
annual net cash flow increases (ΔNCF) generated
by the FF H1 system and the annual investments
made by Dickinson in the system. At an
interest rate of 10% per year, determine the PI of
this endeavor. Has it proven to be economically
worthwhile? (Note: Problem 9.54 explores the
fieldbus implementation further using a
spreadsheet.) Year 0 1 2 3 4 5 6
ΔNCF, $10,000 per year 0 5 7 9 11 13 20
Investment, $10,000 15 8 10 0 0 5 10
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