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
Videos
Textbook Question
Chapter 2, Problem 72P
The present worth in year 10 of a decreasing geometric gradient series was calculated using tabulated factors to be $80,000. If the interest rate was 10% per year and the annual rate of decrease was 8% per year, determine the cash flow amount in year 1 using (a) tabulated factors, and (b) the Goal Seek tool in Excel. (Hint: See Appendix A, section A.4).
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
An entrepreneurial electrical engineer approached a large water utility with a proposal that promises to reduce the utility’s power bill by at least 15% through installation of patented surge protectors. The proposal states that the engineer will not be paid for the first year, but beginning in year 2, she will receive three equal, annual payments that are equivalent to 60% of the power bill savings achieved in year 1 due to the protectors. Assuming that the utility’s power bill of $1 million per year is reduced by 15% after installation of the surge protectors, what is (a) the present worth in year 0 of the uniform payments to the engineer, and (b) their future worth in year 4? Use an interest rate of 10% per year.
An engineer received a bonus of $12,000 that he will invest now. He wants to calculate the equivalent value after 24 years, when he plans to use all the resulting money as the down payment on an island vacation home. Assume a rate of return of 8% per year for each of the 24 years. Find the amount he can pay down, using the tabulated factor, the factor formula, a spreadsheet function, and a calculator function.
Automationdirect, which makes 6-inch TFT color touch screen HMI panels, is examining its cash flow requirements for the next 5 years. The company expects to replace office machines and computer equipment at various times over the 5-year planning period. Specifically, the company expects to spend $7000 two years from now, $9000 four years from now, and $15,000 five years from now. Determine the present worth of the planned expenditures at an interest rate of 10% per year using (a) tabulated factors, and (b) a financial calculator.
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
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Similar questions
- Bodine 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_forwardThe National Institute on Drug Abuse has spent $15 million on clinical trials to find out whether two vaccines can end the bad habits of nicotine and cocaine addiction. A Swiss company is now testing an obesity vaccine. If the vaccines are semi-successful such that treatment costs and medical bills are reduced by an average of $15,000 per person per year, what is the annual worth of the vaccines for 10 million beneficiaries in year one and an additional 15% people each year through year 5? Use an interest rate of 8% per year.arrow_forwardFor the cash flow revenues shown below, find the value of G that makes the equivalent annual worth in years 1 through 7 equal to $500. The interest rate is 9% per year.arrow_forward
- Northwest Iron and Steel is considering getting involved in electronic commerce. A modest e-commerce package is available for $30,000. The company wants to recover the cost in 2 years. Find the equivalent amount of new revenue that must be realized every 6 months at an interest rate of 3% per quarter using (a) factor formula, and (b) a single-cell spreadsheet function that includes an EFFECT function.arrow_forwardThe by-product department of Iowa Beef has the revenue stream shown. If the interest rate is an effective 12% per year compounded continuously, determine the annual worth of the revenues for years 1 through 5.arrow_forwardCorrosion problems and manufacturing defects rendered a gasoline pipeline between El Paso, TX, and Phoenix, AZ, subject to longitudinal weld seam failures. The pressure was reduced to 80% of the design value. If the reduced pressure resulted in delivery of less product valued at $100,000 per month, what will be the value of the lost revenue after a 2-year period at an interest rate of 15% per year, compounded continuously?arrow_forward
- The State of Chiapas, Mexico, decided to fund a program for improving reading skills in elementary school students. The first cost is $300,000 now, and an update amount of $100,000 every 5 years forever. Determine the perpetual equivalent annual cost at an interest rate of 10% per year.arrow_forwardA construction company plans to accelerate the payments on an equipment loan as production increases. The initial payment is P 10,000 per year and the plan is to increase the payment beginning in year 2, by an additional P 1,000 each year through year 10. Determine the equivalent annual payment if the loan interest rate is 12%. (with cash flow diagram if possible)arrow_forwardA small oil company wants to replace its Micro Motion Coriolis flowmeters with Emerson FSeries flowmeters in Hastelloy construction. The replacement process will cost the company $50,000 three years from now. How much money must the company set aside each year beginning one year from now in order to have the total amount in three years? Assume the company will invest its funds at 20% per year.arrow_forward
- Because unintended lane changes by distracted drivers are responsible for 43% of all highway fatalities, Ford Motor Co. and Volvo launched a program to jointly develop a technology to prevent accidents by sleepy or distracted drivers. A device costing $260 tracks lane markings and sounds an alert during lane change. If these devices are included in 100,000 new cars per year beginning 3 years from now, determine the present worth of the cost over a 10-year period at an interest rate of 10% per year.arrow_forwardHow much is the interest that will be paid on a Php25,000 loan that was made on May 1, 2002 and repaid on August 1, 2005 with exact simple interest at 8% per year.arrow_forwardImprovised explosive devices are responsible for many deaths in times of strife and war. Unmanned ground vehicles can be used to disarm the IEDs and perform other tasks as well. If the robots cost $125,000 each and the military arms unit signs a contract to purchase 3,500 of them now and another 6,500 one year from now, what is the equivalent annual cost of the contract over a 6-year period at 8% per year interest? The equivalent cost of the contract is determined to be whatarrow_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
Difference between Renewable and Nonrenewable Resources; Author: MooMooMath and Science;https://www.youtube.com/watch?v=PLBK1ux5b7U;License: Standard Youtube License