Basics Of Engineering Economy
2nd Edition
ISBN: 9780073376356
Author: Leland Blank, Anthony Tarquin
Publisher: MCGRAW-HILL HIGHER EDUCATION
expand_more
expand_more
format_list_bulleted
Question
Chapter 2, Problem 57P
(a):
To determine
Calculate the increasing cost.
(b):
To determine
Interpretation of the annual worth.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
The highway department expects the cost of maintenance of a piece of heavy construction
equipment to be 5000 OMR in year 1, to be 5500 OMR in year 2 and to increase annually by
500 OMR through year 10. At an interest rate of 10% per year, determine the present worth of
maintenance cost. Also show the cash flow diagram
A large water utility is planning to upgrade its system for controlling well pumps, booster pumps, and disinfection equipment, so that everything can be controlled from one site. The first phase will reduce labor and travel costs by $14,000 per year. The second phase will reduce costs by $9,000 per year. If phase I savings occur from the start up to year 3 and phase II occurs in years 4 through 10, what is the equivalent annual worth of the upgraded system in years 1 though 10 at an interest rate of 8% per year? [round to the nearest ten dollars]
An effective method to recover water used for regeneration of ion exchange resins
is to use a reverse osmosis system in a batch treatment mode. Such a system involves recirculation
of the partially treated water back into the feed tank, causing the water to heat up. The water can
be cooled using one of two systems: a single-pass heat exchanger or a closed-loop heat exchange
system.
The single-pass system, good for 4 years, requires a small chiller costing $900 plus stainless steel
tubing, connectors, valves, etc. costing $600. The cost of water, treatment charges, electricity, etc.
will be $5 per hour.
The closed-loop system will cost $4, 000 to buy, will have a useful life of 6 years, and will cost $2
per hour to operate. An overhaul cost of $200 is incurred in the first year and this cost is increased
by 5% every year.
What is the minimum number of hours per year that the cooling system must be used in order
to justify purchase of the closed-loop system? The interest rate…
Chapter 2 Solutions
Basics Of Engineering Economy
Ch. 2 - Prob. 1PCh. 2 - Prob. 2PCh. 2 - Prob. 3PCh. 2 - Prob. 4PCh. 2 - Prob. 5PCh. 2 - Prob. 6PCh. 2 - Prob. 7PCh. 2 - Prob. 8PCh. 2 - Prob. 9PCh. 2 - Prob. 10P
Ch. 2 - Prob. 11PCh. 2 - Prob. 12PCh. 2 - Prob. 13PCh. 2 - Prob. 14PCh. 2 - Prob. 15PCh. 2 - Prob. 16PCh. 2 - Prob. 17PCh. 2 - Prob. 18PCh. 2 - Prob. 19PCh. 2 - Prob. 20PCh. 2 - Prob. 21PCh. 2 - Prob. 22PCh. 2 - Arctic and Antarctic regions are harsh...Ch. 2 - Prob. 24PCh. 2 - Prob. 25PCh. 2 - Prob. 26PCh. 2 - Prob. 27PCh. 2 - Prob. 28PCh. 2 - Prob. 29PCh. 2 - Prob. 30PCh. 2 - Prob. 31PCh. 2 - Prob. 32PCh. 2 - Prob. 33PCh. 2 - Prob. 34PCh. 2 - Prob. 35PCh. 2 - Prob. 36PCh. 2 - Prob. 37PCh. 2 - Prob. 38PCh. 2 - Prob. 39PCh. 2 - Prob. 40PCh. 2 - Prob. 41PCh. 2 - Prob. 42PCh. 2 - Prob. 43PCh. 2 - Prob. 44PCh. 2 - Prob. 45PCh. 2 - Prob. 46PCh. 2 - Prob. 47PCh. 2 - Prob. 48PCh. 2 - Prob. 49PCh. 2 - Prob. 50PCh. 2 - Prob. 51PCh. 2 - Prob. 52PCh. 2 - Prob. 53PCh. 2 - Allen Bradley claims that its XM1Z1A and XM442...Ch. 2 - Prob. 55PCh. 2 - Prob. 56PCh. 2 - Prob. 57PCh. 2 - Prob. 58PCh. 2 - Prob. 59PCh. 2 - Prob. 60PCh. 2 - Prob. 61PCh. 2 - Prob. 62PCh. 2 - Prob. 63PCh. 2 - Prob. 64PCh. 2 - Prob. 65PCh. 2 - Prob. 66PCh. 2 - Prob. 67PCh. 2 - Prob. 68PCh. 2 - The effort required to maintain a scanning...Ch. 2 - Prob. 70PCh. 2 - Prob. 71PCh. 2 - The present worth in year 10 of a decreasing...Ch. 2 - Prob. 73PCh. 2 - Prob. 74PCh. 2 - Prob. 75PCh. 2 - Prob. 76PCh. 2 - Prob. 77PCh. 2 - Prob. 78PCh. 2 - Prob. 79PCh. 2 - Prob. 80PCh. 2 - Prob. 81PCh. 2 - Prob. 82PCh. 2 - Prob. 83PCh. 2 - Prob. 84PCh. 2 - Prob. 85PCh. 2 - Prob. 86PCh. 2 - Prob. 87PCh. 2 - Prob. 88PCh. 2 - Prob. 89PCh. 2 - Prob. 90PCh. 2 - Prob. 91PCh. 2 - Prob. 92PCh. 2 - Prob. 93PCh. 2 - Prob. 94PCh. 2 - Prob. 95PCh. 2 - Prob. 96PCh. 2 - Prob. 97PCh. 2 - Prob. 98PCh. 2 - Prob. 99PCh. 2 - Prob. 100PCh. 2 - Prob. 101PCh. 2 - Prob. 102PCh. 2 - Prob. 103PCh. 2 - Prob. 104PCh. 2 - Prob. 105PCh. 2 - Prob. 106PCh. 2 - Prob. 107PCh. 2 - Union Pacific is considering the elimination of a...Ch. 2 - Prob. 109PCh. 2 - Prob. 110PCh. 2 - Prob. 111PCh. 2 - Prob. 112APQCh. 2 - Prob. 113APQCh. 2 - Prob. 114APQCh. 2 - Prob. 115APQCh. 2 - Prob. 116APQCh. 2 - Prob. 117APQCh. 2 - Prob. 118APQCh. 2 - Prob. 119APQCh. 2 - Prob. 120APQCh. 2 - Prob. 121APQCh. 2 - Prob. 122APQCh. 2 - Prob. 123APQCh. 2 - Prob. 124APQCh. 2 - Prob. 125APQCh. 2 - Prob. 126APQ
Knowledge Booster
Similar questions
- A company has been tracking the average inspection cost on a robotics line for 8 years. Cost averages were steady at $200 per completed unit for the first 4 years, but have increased by $50 per unit for eacch of the last 4 years. What is the general relation used to calculate total present worth in year 0?arrow_forwardLifetime Savings Accounts, known as LSAs, allow people to invest after-tax money without being taxed on any of the gains. If an engineer invests $10,000 now and $10,000 each year for the next 20 years, how much will be in the account immediately after the last deposit, provided the account grows by 10% per year?arrow_forwardA $10,000 loan amortized over 5 years at an interest rate of 10% per year requires payments of $2638 to completely remove the loan when interest is charged on the unrecovered balance of the principal. If interest is charged on the original principal instead of the unrecovered balance, what is the loan balance after 5 years, provided the same $2638 payments are made each year?arrow_forward
- The production of polyamide from raw materials of plant origin, such as castor oil, requires 20% less fossil fuel than conventional production methods.Darvon Chemicals borrowed $6 million to implement the process. If the interest rate on the loan is 10% per year for 10 years, what is the amount of interest for year 2?arrow_forwardA Company purchased equipment that has two year warranty and AOC = $1500 per year, beginning in year 3 and continuing through the equipment's 10-year life. What is the approximate PW of the operating cost if the interest rate is 9%?arrow_forwardA large water utility is planning to upgrade its SCADA system for controlling well pumps, booster pumps, and disinfection equipment, so that everything can be controlled from one site. The first phase will reduce labor and travel cost by $14,000 per year. The second phase will reduce costs by additional $9,000 per year. If Phase-I savings occur in years 0, 1, 2, and 3 and Phase-II occurs in years 4 through 10. Determine the equivalent worth of the upgraded system in years 1 through 10 at an interest rate of 8% per year.arrow_forward
- El Paso Water (EPW) purchases surface water for treatment and distribution to EPW customers from the County Water Improvement District during the irrigation season. A new contract between the two entities resulted in a reduction in future price increases in the cost of the water from 8% per year to 4% per year for the next 20 years. The cost of water next year (which is year 1 of the new contract) will be $260 per acre-ft. Using an interest rate of 6% per year, (a) Determine the present worth of the savings (in terms of $/acre-ft) to EPW between the old and the new contracts. (b) Determine the total present worth of the savings over the life of the contract if EPW uses 51,000 acre-ft per year.arrow_forwardBodine Electric, based in Des Moines, Iowa, USA, makes gear motors with a three-stage, selectivelyhardened gearing cluster that is permanently lubricated. If the company borrows $20 million for a new distribution facility in Europe, how much must it pay back each year to repay the loan in six equal annual payments at an interest rate of 10% per year?arrow_forwardWestern Refining purchased a model MTVS peristaltic pump for injecting antiscalant at its nanofiltration water conditioning plant. The cost of the pump was $1200. If the chemical cost is $11 per day, determine the equivalent cost per month at an interest rate of 1% per month. Assume 30 days per month and a 4-year pump life.arrow_forward
- Revenue from the sale of ergonomic hand tools was $300,000 in years 1 through 4 and $465,000 in years 5 through 9. Determine the equivalent annual revenue in years 1 through 9 at an interest rate of 10% per year.arrow_forwardAutomobiles of the future will most likely be manufactured largely with carbon fibers made from recycled plastics, wood pulp, and cellulose. Replacing half the ferrous metals in current automobiles could reduce a vehicle’s weight by 60% and fuel consumption by 30%. One impediment to using carbon fibers in cars is cost. If the justification for the extra sticker price of carbon-fiber cars is solely based on fuel savings, how much extra sticker price can be justified over a six-year life span if the carbon-fiber car would average 39 miles per gallon of gasoline compared to a conventional car averaging 30 miles per gallon? Assume that gasoline costs $4.00 per gallon, the interest rate is 20% per year, and 117,000 miles are driven uniformly over six years.arrow_forwardAn oil refinery finds that it is necessary to treat the waste liquids from a new process before discharging them into a stream. In-house treatment will have an annual cost of $50,000 the first year, but process improvements will allow the annual cost to decline by $5,000 each subsequent year. As an alternative, an outside company will process the wastes for an initial cost of $32,400 and an annual fixed price of $30,400/year throughout the 13 year period. Either way, there is no need to treat the wastes after 13 years. Using the AW method, calculate the equivalent uniform annual cost (EUAC) of each alternative and determine how the waste should be processed. The company's MARR is 8%. LOADING... Click the icon to view the interest and annuity table for discrete compounding when the MARR is 8% per year.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSON
Engineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
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