ENGINNERING ECONOMY (LOOSE)
8th Edition
ISBN: 9781260855241
Author: Blank
Publisher: MCG
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Chapter 1, Problem 3P
To determine
Measure of worth.
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Sebastian is about to compare a set of mutually exclusive and indivisible alternatives using a ranking approach. Which of the following is not an appropriate measure of worth? a. Present worth b. Annual worth c. Future worth d. Internal rate of return
An item is purchased for P100 000. Annual cost is P 16 000. Using 8%, what is the capitalized cost of perpetual service?
To choose the best alternative among the given alternatives in the annual cash flow analysis method, it is necessary to compute the EUAW for each alternative over a period of one cycle only.
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Chapter 1 Solutions
ENGINNERING ECONOMY (LOOSE)
Ch. 1 - Prob. 1PCh. 1 - Prob. 2PCh. 1 - Prob. 3PCh. 1 - Prob. 4PCh. 1 - Prob. 5PCh. 1 - Prob. 6PCh. 1 - Prob. 7PCh. 1 - Prob. 8PCh. 1 - Prob. 9PCh. 1 - Prob. 10P
Ch. 1 - Prob. 11PCh. 1 - Prob. 12PCh. 1 - Prob. 13PCh. 1 - Prob. 14PCh. 1 - Prob. 15PCh. 1 - Prob. 16PCh. 1 - Determine the amount of money FrostBank might loan...Ch. 1 - Prob. 18PCh. 1 - Prob. 19PCh. 1 - Prob. 20PCh. 1 - Prob. 21PCh. 1 - Prob. 22PCh. 1 - Prob. 23PCh. 1 - Prob. 24PCh. 1 - To attract new customers, EP Employees Credit...Ch. 1 - Prob. 26PCh. 1 - Prob. 27PCh. 1 - Prob. 28PCh. 1 - Prob. 29PCh. 1 - Prob. 30PCh. 1 - Prob. 31PCh. 1 - Prob. 32PCh. 1 - State University tuition and fees can be paid...Ch. 1 - Prob. 34PCh. 1 - Prob. 35PCh. 1 - Prob. 36PCh. 1 - Prob. 37PCh. 1 - Prob. 38PCh. 1 - Prob. 39PCh. 1 - Prob. 40PCh. 1 - Prob. 41PCh. 1 - Prob. 42PCh. 1 - Prob. 43PCh. 1 - What is the weighted average cost of capital for a...Ch. 1 - Prob. 45PCh. 1 - Prob. 46PCh. 1 - Prob. 47PCh. 1 - Prob. 48ESCh. 1 - Prob. 49ESCh. 1 - Prob. 50ESCh. 1 - Prob. 51ESCh. 1 - Prob. 52APQCh. 1 - Prob. 53APQCh. 1 - Prob. 54APQCh. 1 - Prob. 55APQCh. 1 - Prob. 56APQCh. 1 - Prob. 57APQCh. 1 - Prob. 58APQCh. 1 - Prob. 59APQCh. 1 - Prob. 60APQCh. 1 - Prob. 61APQCh. 1 - Prob. 1CSCh. 1 - Prob. 2CSCh. 1 - You developed an interest in the LCOE relation and...
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- Problems and applications Q6arrow_forwardA finance company advertises two investment plans. In Plan A, the company pays P10,500 after 12 years for every P10,000 now. In Plan B, for every P10,000, the company pays P60,000 at the end of the 10th year and P40,000 at the end of the 15th year. Choose the best plan if interest is 10% annually using Present Worth Analysis Methodarrow_forwardWhat is the annual worth approach? How is it useful?arrow_forward
- Concurris Prototyping is committed to using the newest and finest equipment in its labs. Accordingly, Wilma, a senior engineer, has recommended that a 2-year-old piece of precision measurement equipment be replaced immediately. She believes it can be demonstrated that the proposed equipment is economically advantageous at a 15%-per year return and a planning horizon of 5 years. Perform the replacement analysis using the annual worth method, a 5-year study period, and the estimates below. Was Wilma correct? Equipment Current Proposed Original purchase price, $ −30,000 −36,000 Current market value, $ 15,000 -- Remaining life, years 5 15 Estimated value in 5 years, $ 7,000 10,000 Salvage value after 15 years, $ -- 5,000 AOC, $ per year −7,000 −3,000 The AW of the defender is $− and the AW of the challenger is $− . Wilma (Click to select) is is not correct.arrow_forwardWhy the annual worth value give you the same exact value for the repeated period? (Why only the annual worth method will give you a value for one period and it will equal the same exact value for the repeated periods?)arrow_forwardoncurris Prototyping is committed to using the newest and finest equipment in its labs. Accordingly, Wilma, a senior engineer, has recommended that a 2 -year-old piece of precision measurement equipment be replaced immediately. She believes it can be demonstrated that the proposed equipment is economically advantageous at a 15%-per year return and a planning horizon of 5 years. Perform the replacement analysis using the annual worth method, a 5 -year study period, and the estimates below. Was Wilma correct? \table[[Equipment,Current,Proposed],[Original purchase price, $,-30,000,-42,000arrow_forward
- A municipal bond with a face value of $10,000 was issued today with an interest rate of 6% per year payable semiannually. The bond matures 20 years from now. If an investor paid $9,000 for the bond and holds it to maturity, all of the following equations will yield the correct semiannual rate of return except: (a) 0 = −9000 + 300(P/A,i*,40) + 10,000(P/F,i*,40) (b) 0 = −9000(F/P,i*,40) + 300(F/A,i*,40) + 10,000 (c) 0 = −9000(A/P,i*,40) + 300 + 10,000(A/F,i*,40) (d) 0 = −9000 + 600(P/A,i*,40) + 10,000(P/F,i*,40)arrow_forwardThree building proposals are being considered by the owner, which proposal is more economical if money is worth 18% compounded semi-annually. (use Present as focal/reference point) A building to be constructed now costing P1.5M, or A smaller building costing P1M now, and an additional room costing P0.5M to be constructed after 5 years, or A single story building costing P.8M now and 2nd floor costing P0.7M to be constructed after 3 yearsarrow_forwardThe Department of Energy is proposing new rules mandating either a 20% increase or a 35% increase in clothes washer efficiency in 3 years. The 20% increase is expected to add $100 to the current price of a washer, while the 35% increase will add $240 to the price. If the cost for energy is $80 per year with the 20% increase in efficiency and $65 per year with the 35% increase, which one of the two proposed standards is more economical on the basis of a future worth analysis at an interest rate of 10% per year? Assume a 15-year life for all washer models.arrow_forward
- The cash flows for two small raw water treatment systems are shown. ِA. Determine which should be selected on the basis of an annual worth analysis at 10% per year interest. B. Draw a cash flow diagramarrow_forwardOnly typed answer Beaver, a city in the United States, is attempting to attract a professional soccer team. Beaver is planning to build a new stadium that will cost $360 million. The annual upkeep is expected to amount to $850,000. The turf will have to be replaced every 13 years at a cost of $980,000. Painting every 7 years will cost $97,000. If the city expects to maintain the facility indefinitely, what is the estimated capitalized cost at i = 9% per year? The estimated capitalized cost is $_______arrow_forwardPlease answer part C and D - As answered earlier the first two parts with ery clear solutions with clear steps and explainantion. Please do not answer if you are not confident.arrow_forward
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