Two alternatives are being considered for the upgrades to a detector at an X-ray synchrotron facility. Which alternative would be selected based the present worth, if the interest rate is 10% per year? Please note: The alternatives are mutually exclusive! Alternative First Cost, $ Operational & Maintenance Costs, $ -25,000 |-10,000 Salvage Value, $ Life, years a Alternative A, PW=-$250,349 A |-100,000 -140,000 20,000 30,000 12 4 h Alternative A, PW=-$355,931 Alternative B, PW = -$198,578 Alternative A, PW = -$120,968 d.
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- Dexcon Technologies, Inc. is evaluating two alternatives to produce its new plastic filament with tribological (i.e., low friction) properties for creating custom bearings for 3-D printers. The estimates associated with each alternative are shown below. Using a MARR of 20% per year, which alternative has the lower present worth? Method DDM LS First cost, $ −164,000 −370,000 M&O cost, $/year −55,000 −21,000 Salvage value, $ 0 30,000 Life, years 2 4It is proposed to place a cable on existing pole line along the shore of a lake to connect two points on opposite sides. Which is more economical? Compare alternatives using the following methods:a) ROR on Additional Investment Methodb) Annual Cost Methodc) Equivalent Uniform Annual Cost Methodd) Present Worth Cost Method Show complete manual solutionIt is proposed to place a cable on existing pole line along the shore of a lake to connect two points on opposite sides. Which is more economical?Compare alternatives using the following methods:a) ROR on Additional Investment Methodb) Annual Cost Methodc) Equivalent Uniform Annual Cost Methodd) Present Worth Cost Method
- Two lathes are being considered in the manufacture of certain machine parts. Data is given below, all cost in peso: LATHE A LATHE B First Cost 40,000 56,000 Salvage Value 5,000 7,000 Annual Maintenance 2,000 2,800 Operation, Cost/hour 4 3.5 Life, in years 10 12 Time per part (hours) 0.40 0.25 REQUIRED: Determine the number of machine parts/year that could be produced so that 2 lathes will be equally economical if the MARR is 18%. Use AWM If the number of parts is 10,000 units, which lathe will you recommend? Use ROR If the number of parts is 10,000 units, which lathe will you recommend? Use PWM If the number of parts is 10,000 units, which lathe will you recommend? Use EUACYou have been asked to evaluate two alternatives, X and Y, that may increase plant capacity for manufacturing high-pressure hydraulic hoses. The parameters associated with each alternative have been estimated. Which one should be selected on the basis of a present worth comparison at an interest rate of 11% per year? Why is yours the correct choice? Alternative X Y First Cost $-30,000 $-60,000 Maintenance cost, per year $-9000 $-3000 Salvage Value $1,500 $2,500 Life 5 years 5 years The present worth of alternative X is $ __ and that of alternative Y is$ __. Alternative __ is selected by the company.You have been asked to evaluate two alternatives, X and Y, that may increase plant capacity for manufacturing high-pressure hydraulic hoses. The parameters associated with each alternative have been estimated. Which one should be selected on the basis of a present worth comparison at an interest rate of 15% per year? Why is yours the correct choice? Alternative X Y First Cost $-25,000 $-80,000 Maintenance cost, per Year $-13000 $-7000 Salvage Value $3,500 $4,500 Life 5 years 5 years The present wort
- A company is trying to decide whether to keep a fork-truck in their factory or to purchase a new one. The existing fork-truck can be sold now for $28,000 or kept for another 5 years with an overhaul now costing $8,250. If the MARR is 10% should the company buy a new AVG now or keep the existing vehicle? Existing Fork-truck New Fork-truck Initial price cost, $ -34,250 (5 yrs ago) -38,250 AOC, $ -5,500 -7,800 Salvage value, $ 2,500 5,500 Life, yrs 10 121. A replacement electric motor is being considered for purchased. It is capable of providing 200 hp. The pertinent data are follows: Cost - 3200 dollars Maintenance Cost per year - 50 dollars Life expectancy - 14years Salvage value - 1,452 dollars The motor is used for 400 h/year and the cost of electricity is 0.0 dollars/kWh. What is most nearly the effective annual cost using an interest rate of 10%A salesman offers a businessman two options for certain machine. Using the Present Value (PV) Method in determining the more economical, what is the Present Value of Option A? Assume interest is 24% cpd. a. Option A: First Cost – P203,692; Annual operating cost – P93,768; Salvage Value – P15,969; and Useful life – 4 years Option B: First Cost – P65,000; Annual operating cost – P20,000; Salvage Value – P2,500; and Useful life – 6 years
- The product development group of a high-tech electronics company developed five proposals for new products. The company wants to expand its product offerings, so it will undertake all projects that are economically attractive at the company’s MARR of 20% per year. The cash flows (in $1000 units) associated with each project are estimated. Which projects, if any, should the company accept on the basis of a present worth analysis? Project A B C D E Initial investment, $ −400 −510 −660 −820 −900 Operating cost, $/year −100 −140 −280 −315 −450 Revenue, $/year 360 235 400 605 790 Salvage value, $ — 22 — 80 95 Life, years 3 10 5 8 4A new water treatment plant proposed for Anytown, has an initial cost of P56 million. The new plant will service the 7,500 residential customers for the next 30 years. It is expected to save each customer P125 per year. The plant will require a major overhaul every 5 years, costing 1 Million. Determine the benefit/cost ratio at the city’s interest rate of 6%. (Use PW and EUAC) show complete solutionsA contractor has a 4-year concrete mixer whose first cost was $6,000, having 3 more years to live before being scrapped and sold at $801. Itcould now be sold for $11,922. It has an annual cost for operation and maintenance of $9,352. Its replacement is being proposed with a newmachine whose first cost will be $8,000 having a life of 9 years and salvage value $1,600. It has an operating cost of $800 per year andmaintenance cost of $320 per year. Ifthe interest is 20% cpd-a, what is the Annual Equivalent Cost of the Old Machine? 14,792