EBK CONTEMPORARY ENGINEERING ECONOMICS
6th Edition
ISBN: 9780134123950
Author: Park
Publisher: PEARSON CUSTOM PUB.(CONSIGNMENT)
expand_more
expand_more
format_list_bulleted
Question
Chapter 3, Problem 12P
To determine
Calculate the present value.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
A certain amount of money doubles after 9 years. Determine its effective interest.
Subject: Engineering Economy
What uniform amount is needed to exhaust a loan of 20, 000 dollars at 10% compounded annually for 5years?
Please show solution
The CTO of a pharmaceutical firm will install one of two mechanical devices to reduce costs. Both devices have useful lives of 5 years and no salvage value.
Device A cost: $10,000
Expected to result in $3,000 savings annually.
Device B cost: $13,285
Expected to result in savings of $3,000 the first year, and then savings will increase $500 annually. [Year 2 savings will be $3,500, Year 3 savings will be $4,000 and so on]
Interest is at 7%,
a) Which device should the firm purchase? Use IRR and show the sequence of alternatives being assessed
b) Which device should the firm purchase? Use ERR and show the sequence of alternatives being assessed
Chapter 3 Solutions
EBK CONTEMPORARY ENGINEERING ECONOMICS
Ch. 3 - Prob. 1PCh. 3 - Prob. 2PCh. 3 - Prob. 3PCh. 3 - Prob. 4PCh. 3 - Prob. 5PCh. 3 - Prob. 6PCh. 3 - Prob. 7PCh. 3 - Prob. 8PCh. 3 - Prob. 9PCh. 3 - Prob. 10P
Ch. 3 - Prob. 11PCh. 3 - Prob. 12PCh. 3 - Prob. 13PCh. 3 - Prob. 14PCh. 3 - Prob. 15PCh. 3 - Prob. 16PCh. 3 - Prob. 17PCh. 3 - Prob. 18PCh. 3 - Prob. 19PCh. 3 - Prob. 20PCh. 3 - Prob. 21PCh. 3 - Prob. 22PCh. 3 - Prob. 23PCh. 3 - Prob. 24PCh. 3 - Prob. 25PCh. 3 - Prob. 26PCh. 3 - Prob. 27PCh. 3 - Prob. 28PCh. 3 - Prob. 29PCh. 3 - Prob. 30PCh. 3 - Prob. 31PCh. 3 - Prob. 32PCh. 3 - Prob. 33PCh. 3 - Prob. 34PCh. 3 - Prob. 35PCh. 3 - Prob. 36PCh. 3 - Prob. 37PCh. 3 - Prob. 38PCh. 3 - Prob. 39PCh. 3 - Prob. 40PCh. 3 - Prob. 41PCh. 3 - Prob. 42PCh. 3 - Prob. 43PCh. 3 - Prob. 44PCh. 3 - Prob. 45PCh. 3 - Prob. 46PCh. 3 - Prob. 47PCh. 3 - Prob. 48PCh. 3 - Prob. 49PCh. 3 - Prob. 50PCh. 3 - Prob. 51PCh. 3 - Prob. 52PCh. 3 - Prob. 53PCh. 3 - Prob. 54PCh. 3 - Prob. 55PCh. 3 - Prob. 56PCh. 3 - Prob. 57PCh. 3 - Prob. 58PCh. 3 - Prob. 59PCh. 3 - Prob. 60PCh. 3 - Prob. 61PCh. 3 - Prob. 62PCh. 3 - Prob. 63PCh. 3 - Prob. 64PCh. 3 - Prob. 65PCh. 3 - Prob. 66PCh. 3 - Prob. 67PCh. 3 - Prob. 68PCh. 3 - Prob. 69PCh. 3 - Prob. 70PCh. 3 - Prob. 71PCh. 3 - Prob. 72PCh. 3 - Prob. 1STCh. 3 - Prob. 2STCh. 3 - Prob. 3ST
Knowledge Booster
Similar questions
- A nominal interest rate of “12% per year compounded yearly” is closest to: (a) 1% per month effective rate (b) 3% per quarter effective rate (c) 6% per 6 months effective rate (d) 12% per year effective ratearrow_forwardIt takes 10.15 years to quadruple your money if invested at x% compounded semi-annually. Find the value of x.arrow_forwardThe buyer of a certain machine may pay either P50k cash down payment & P10k annually for the next 5 years, or pay P60k cash & P10k annually for the next 5 years, 2 years after. If money is worth 12% compounded annually, which method is better for the buyer and by how much?arrow_forward
- A series of monthly cash flows is deposited into an account that earns 12% nominal interest compounded monthly. Each monthly deposit is equal to $2100. The first monthly deposit occurred on June 1, 2012 and the last monthly deposit will be on January 1, 2019. The account (the series of monthly deposits, 12% nominal interest, and monthly compounding) also has equivalent quarterly withdrawals from it. The first quarterly withdrawal is equal to $5000 and occurred on October 1, 2012. The last $5000 withdrawal will occur on January 1, 2019. How much remains in the account after the last withdrawal?arrow_forwardThe buyer of a certain machine may pay either a $2,000 cash down payment and $2,500 annually for the next 6 years or $3,500 cash and $2,500 annually for the next 5 years. If money is worth 12% compounded annually, which method of payment is better for the buyer and by how much? All annual payments are made at the beginning of every period.arrow_forwardA certain sum of money will be deposited in a savings account that pays interest at the rate of 6% per year, compounded annually. If all of the money is allowed to accumulate, how much must be deposited initially so that $5,000 will have accumulated after 10 yearsarrow_forward
- A company has issued 10-year bonds, with face value of 1,000,000 in 1,000 units. Interest at 16% is aid quarterly. If an investor desires to earn 20% nominal interest on 100,000 worth of these bonds, what would the selling rice have to be?arrow_forwardA loan was to be amortized by a group of four end-of-year payments forming an ascending arithmetic progression. The initial payment was to be P 5,000 & th difference between successive payments was to be P 400. But the loan was renegotiated to provide for the payment of equal arther than uniformly varying sums. If the interest rate of the loan was 15%, what was the annual payment?arrow_forwardA child’s grandparents have opened a ₱60,000 savings account for the child on the day of her birth. The account pays 1/2% compounded semiannually. The child will be allowed to withdraw the money when she reaches the age of 25. What will the account be worth at that time?arrow_forward
- Engineering Economics Several payments are to be made by a person with a lot of debts. 1st payment: ₱2,000 compounded quarterly at 2% for 2yrs 2nd payment: ₱4,000 payable compounded semi-annually at 7% for 3yrs every end of the month 3rd payment: ₱3,000 compounded annually at 8% for 4yrs payable every beginning of the month How much money today must be set aside to cover all the person’s debt? Note: payments are made sequentially.arrow_forwardEngr. Simon borrows P100,000 at 10% effective annual interest. He must pay back the loan over 30 years with uniform monthly payment due on the first day of each month. What does Engr. Simon pay each month?arrow_forwardA contractor obtained a 10000 loan at the rate of 6% compounded annually in order to repair a house. How much must he pay monthly to amortize the loan within a period of 10 years?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