Give me right solution with clear calculations The following annual costs are associated with three new machines for use in a Styrofoamcup plant.Use Rate of Return Analysis to choose which Equipment should the company choose. if theMRR is 10%.DataAВCUseful Life, Years9.1311First Cost$2,300,000 $2,780,000 $2,540,000Salvage Value$82,000$118,000$97,000Annual Benefit$580,000 $670,000 $650,000M&O$65,000$78,000$71,000M&O Gradient$11,000$15,000$12,500

at an interest rate (i) of 10% To find the present worth, PVAF is calculated for each year. PVAF =…

Answered: The following annual costs are…

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

For the net cash flow and cumulative cash flows shown, the value of x is nearest: (a) $−8,000 (b) $−16,000 (c) $16,000 (d) $41,000 Year 1 2 3 4 5 Net Cash Flow, $ +13,000 −29,000 −25,000 50,000 x CCF, $ +13,000 −16,000 −41,000 +9000 +1000
An investment proposal calls for a $417,805.55 payment now and a second $282,934.40 payment 9 years from now. The investment is for a project with a perpetual life. The annual interest rate is 6%. What is the equivalent uniform annual cost? (Please show your full solution)
Consider your self as a businessman, you owned 5 storey building with a total of 35-unit apartment near at the downtown area of Davao City. You felt that because the location of the apartment will be occupied 95% at all time. You desires a rate of return 30%. Other pertinent data are the following: Land investment - 8,000,000.00 Building investment - 20,000,000.00 Study period - 30 yrs Cost of the land after 30 yrs - 25,000,000.00 Cost of the building after 30 yrs - 5,000,000.00 Rent per unit per month - 7,500.00 Upkeep per unit per year - 1,500.00 Property Taxes - 1% Insurance - 0.5% Is this a good investment? And what is the Payback period of investment? Note: use all the method.
SHOW COMPLETE DETAILS AND SOLUTION . 4. A new civil engineer employee start a savings plan in which he saves P 10,000 eachyear for 15 years. He makes her first payment at age 22 and after paying for 15 yearsshe leaves the accumulated sum in the savings plan until she reach age 65. If thesavings plan pays 10% per year, how much will be in the savings account when sheage 65?5. Mr. Jo needs P 4,000,000 immediately to pay for a new home. Having insufficientfund for this, he borrows P 2,000,000 from an insurance company and repay the loanevery six months for 15 years, the first payment being at the end of 8 years from now.If the insurance company charged him 8% compounded semiannually, how much isthe amount of each payment?
5-27image If produced by Method A, a product’s initial capital cost will be $100,000, its annual operating cost will be $20,000, and its salvage value after 3 years will be $20,000. With Method B there is a first cost of $150,000, an annual operating cost of $10,000, and a $50,000 salvage value after its 3-year life. Based on a present worth analysis at a 15% interest rate, which method should be used?
Year End Cash Flow Alternative A Alternative B 0 -1,000 600 1 600 500 2 600 -2,000 3 600 400 4 600 200 5 -2,100 -1,000 6 700 1,386 a) Solve for the Net Present Value of the alternatives A and B using interest rates from 0% upward. b) Plot the curves on the resulting net present values against interest rates. c) What are the rates of return of the two alternatives? d) What is the rate of return on the difference between the alternatives? e) If your MARR is 8 percent, which alternatives would you select? Comment briefly on your results. What are some problems associated with the ROR method? f) Assume the negative cash flows are costs and the positive ones are benefits. What are the Benefit Cost ratios over the analysis period? This problem requires many iterations. Use interest tables and/or write a computer program to solve it.
ENGINEERING ECONOMICSMenchie bought his brother a laptop 5 years ago which has a cost of around 25,000PhP. The laptop’s life span willlast until 5 years. She has a friend which is a computer technician who advised her that the laptop’s life span couldextend until 10 years if she could spend semi-annual maintenance of 100Php with a 10Php increase rate startingthe next period of maintenance inspection. How much is the total future cost assuming that the money will havea rate of 2% compounded semi-annually if she decided to enjoy using her laptop beyond the expected life spanupon purchasing?
Problem Solving: Pls. Include your cash flow diagram. Show complete solution.1. A newly-built business property, containing space for a store and two offices, can bepurchased for P1, 200, 000. A prospective buyer estimates that during the next 10 years hecan obtain annual rentals of at least P458, 460 from the property and that the annual out-of-pocket disbursements will not exceed P60, 000. He believes that he should be able todispose of the property at the end of 10 years at not less than P700, 000. Annual taxes andinsurance will total 2.5% of the first cost.(a) Assume he has sufficient equity capital to purchase the property, and that the averagereturn he is obtaining from his capital is 20%. Would you recommend the investment? UseROR method. (b) What recommendation would you make if he had to borrow 25% of the required capital,on the basis of a 10-year amortization with interest of 18%? Use Annual Worth Method(c) If the entire capital can be obtained by floating bonds at 15% that…
ligthing first cost of investment is $120,000. annual mtnce expenses are expected to be $6600 for the first 22 years and $9000 for each year thereafter. N=infinety amt of time, interest,i=12% per year, what is the capatalized cost of this project? the annuity table for value N=22 as follows: F/P=12.1003 P/F=.0826 P/A=7.6446 I tried mutliple ways to show and I can't figure it out. the answer is $176,653. Any suggestions is greatly appreciated. Thanks
Given the cash flows in table below. Determine the value of P. i= 6% per year Year 0 1 2 3 4 5 Cash Flow -P 400 800 1200 1600 1800 Group of answer choices $4709.14 $6125.15 $5125.63 $4978.23
An oil company is planning to install a new 80 mm pipeline to connect storagetanks to a processing plant 1500 m away. The connection will be needed for theforeseeable future. Refer to their costs incurred below:initial cost: RM15,000service life: 12 yearssalvage value: RM200one-off saving in year 8: RM 300annual profit: RM400annual pump operation hours: 450 hourspump cost per hours: RM2.50Calculate the single project evaluation using Benefit Cost Ratio PW analysismethod, which is preferred if the MARR is 7%. Draw the cashflow diagram.
How much money would have to be placed in a sinking fund each year toreplace machine B at the end of 25 years if the fund yields 10% annualcompound interest and if the first cost of the machine is assumed toincrease at a 6% annual compound rate? (Assume the salvage value doesnot change.) Group of answer choices A. $3,600 B. $4,110 C. $2,400 D. $7,000

SEE MORE QUESTIONS

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Managerial Economics: A Problem Solving Approach

Economics

ISBN:

9781337106665

Author:

Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:

Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-…

Economics

ISBN:

9781259290619

Author:

Michael Baye, Jeff Prince

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS