Doodads R Us Company needs thingamabobs to insert into the doodads it manufactures. It can purchase thingamabobs in bulk at $150 each or it can purchase a doodad manufacturing machine. If it purchases the machine, it will have an initial cost of $145,000 as well as annual costs of $9000 and operating costs of $35 per doodad produced. MARR is 12%. Use annual worth analysis to determine which whether to buy the machine if: a. annual needs are 200 doodads per year b. annual needs are 500 doodads per year Upload Choose a File

Doodads R Us Company needs thingamabobs to insert into the doodads it manufactures. It can purchase thingamabobs in bulk at $150 each or it can purchase a doodad manufacturing machine. If it purchases the machine, it will have an initial cost of $145,000 as well as annual costs of $9000 and operating costs of $35 per doodad produced. MARR is 12%. Use annual worth analysis to determine which whether to buy the machine if: a. annual needs are 200 doodads per year b. annual needs are 500 doodads per year Upload Choose a File

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

a company is considering the purchase of a new Lathe, where there are 3 alternative Lathes with brands D, E and F with economic value for each Lathe as follows; Lathe Machine D Lathe Machine E Lathe Machine F Initial Cost (Million Rp) 530 540 480 Maintenance Cost (MillionRp) 90 80 100 Residual Value (Million Rp) 60 130 80 Operating Life 10 10 10 Question: Do a Present Worth Analysis to be able to determine the Alternative chosen from the three Generators with MARR = 13%?
You bought the latest iPhone 13 for your online selling business for 94000. With this , your online income has increased by 1000 annually. After 7 years, your iPhone 13 can be sold at 14 000. You have set your personal MARR to be at 8%. Was your purchase of iPhone 13 economically viable? Show complete solution using present worth method, annual worth method and future worth method with cash flow diagram
Imagineering, Inc., is considering an investment in CAD-CAM compatible design software with the cash flow profile shown in the table below. Imagineering’s MARR is 23 %/year. End of Year Cash Flow (M$) 0 -$12 1 -$1 2 $5 3 $2 4 $5 5 $5 6 $2 7 $5 Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure. What is the future worth of this investment? $
Compute for the Annual Worth of MEA1 and explain. Compute using the Annual Worth formula and WITHOUT using Excel sheets. Thank you. MARR = 12%
An electric cooperative is considering the use of a conicrete electric pole in the expansion of its power distribution lines A concrete pole costs 18.0o0 each and will last 20 years The company is presently using creosoted wooden poles which cost 12.000 per pole and will last 10 years. If money is worth 12 percent, which pole shoulcd be used? Assurne annual taxes amount to1 percerit of first cost and zero salvage value in both cases a) Use rate of return method b) if the maximum retum on investment is 20% what is the justifiable arnount that can be paid for concrete electric pole?
Margaret has a project with a £ 28,000 first cost that returns £ 5,000 per year over its 10-year life. It has salvage value of £ 2,900 at the end of 10 years. If the MARR is 11 %, (Use 5 significant figures for your calculations, and round your answers to the nearest dollar. Indicate losses as a negative value.) (a) What is the present worth of this project? (b) What is the annual worth of this project? (c) What is the future worth of this project after 10 years?
Bailey, Inc., is considering buying a new gang punch that would allow them to produce circuit boards more efficiently. The punch has a first cost of $105,000 and a useful life of 15 years. At the end of its useful life, the punch has no salvage value. Annual labor costs would increase $3,500 using the gang punch, but annual raw material costs would decrease $7,000. MARR is 4.0 %/year. What is the present worth of this investment?
Littrell's Nursery needs a new irrigation system. System one will cost $145,000, have annual maintenance costs of $10,000, and need an overhaul at the end of year six costing $30,000. System two will have first year maintenance costs of $5,000 with increases of $500 each year thereafter. System two would not require an overhaul. Both systems will have no salvage value after 12 years. If Littrell's cost of capital is 4%, using annual worth analysis determine the maximum Littrell's should be willing to pay for system two.
J&M Manufacturing plans on purchasing a new assembly machine for $30,000 to automate one of its current manufacturing operations. It will cost an additional $5,500 to have the new machine installed. With the new machine, J&M expects to save $11,000 in annual operating and maintenance costs. The machine will last fivr years with an expected salvage value of $6,000. a. How long will it take to recover the investment (plus installation cost)? The payback period is ? years. (Round up to the nearest whole number.) b. If J&M's interest rate is known to be 13%, determine the discounted payback period. The discounted payback period is ? years. (Round up to the nearest whole number.) Please give proper explanation of the each sub question given above.will give you thumbs up only for the correct answer. Thank you
Triple J Construction Firm had put up for sale of some of their heavy equipmentfor construction works. There were two interested buyers submitting their respective bidsfor the heavy equipment. The bids are as follows:Buyer A offers P10,000,000 payable 20% down payment, the balance payable P1,000,000annually for 8 years.Buyer B offers P9,000,000 payable P2,000,000 down payment, the balance payableP500,000 semi-annually for 7 years.How much is the difference between the two bids if money is worth 10% effective?ANSWER: P347,733.29
Hinson’s Homegrown Farms needs a new irrigation system. System one will cost $145,000, have annual maintenance costs of $10,000, and need an overhaul at the end of year six costing $30,000. System two will have first-year maintenance costs of $5000 with increases of $500 each year thereafter. System two would not require an overhaul. Both systems will have no salvage value after 12 years. If Hinson’s cost of capital is 4%, using annual worth analysis determine the maximum Hinson’s should be willing to pay for system two.
13. An industrial engineer invests $100,000.00 now, and in three years he adds $3,000.00 to the investment. He is able to withdraw $5,000.00 the first year increasing by $1,000.00 each year for 10 years. He also will be withdrawing $50,000.00 in five years and $20,000.00 in 10 years. Using net present worth analysis, determine the rate of return on the investment. Using equivalent uniform annual worth analysis, determine the rate of return.