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 4, Problem 40P
To determine
Select the project.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
An 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.
Adams Manufacturing spent $30,000 on a new sterilization conveyor belt, which resulted in a cost savings of $4202 per year. The length of time it should take to recover the investment at 8% per year is closest to: (a) Less than 6 years (b) 7 years (c) 9 years (d) 11 years
The Civil Engineering department at RRCP plans to purchase a 3D printer for the CARSI lab. One option is the purchase of a brand new machine (purchase price $1900), and will have a salvage value of $700 after three years. A second option is the purchase of a refurbished machine (purchase price $1200), which will cost $250 per year to maintain, with a salvage value of $250 after three years. What is the interest rate that will make these two options equivalent with respect to Present Worth?
Chapter 4 Solutions
Basics Of Engineering Economy
Ch. 4 - State two conditions under which the do-nothing...Ch. 4 - Prob. 2PCh. 4 - Prob. 3PCh. 4 - Prob. 4PCh. 4 - Prob. 5PCh. 4 - Prob. 6PCh. 4 - Prob. 7PCh. 4 - Prob. 8PCh. 4 - Prob. 9PCh. 4 - The costs associated with manufacturing a...
Ch. 4 - Prob. 11PCh. 4 - Prob. 12PCh. 4 - Prob. 13PCh. 4 - Prob. 14PCh. 4 - Prob. 15PCh. 4 - Prob. 16PCh. 4 - Prob. 17PCh. 4 - Prob. 18PCh. 4 - Prob. 19PCh. 4 - Prob. 20PCh. 4 - Prob. 21PCh. 4 - Prob. 22PCh. 4 - Prob. 23PCh. 4 - Prob. 24PCh. 4 - Prob. 25PCh. 4 - Prob. 26PCh. 4 - Prob. 27PCh. 4 - Prob. 28PCh. 4 - Prob. 29PCh. 4 - Prob. 30PCh. 4 - Prob. 31PCh. 4 - Two mutually exclusive projects have the estimated...Ch. 4 - Prob. 33PCh. 4 - Prob. 34PCh. 4 - Prob. 35PCh. 4 - Prob. 36PCh. 4 - Prob. 37PCh. 4 - The manager of engineering at the 900-megawatt...Ch. 4 - Prob. 39PCh. 4 - Prob. 40PCh. 4 - Prob. 41PCh. 4 - Three different plans were presented to the GAO by...Ch. 4 - The U.S. Army received two proposals for a turnkey...Ch. 4 - Prob. 44PCh. 4 - Prob. 45PCh. 4 - Prob. 46PCh. 4 - Prob. 47PCh. 4 - Prob. 48PCh. 4 - Prob. 49PCh. 4 - Prob. 50PCh. 4 - Prob. 51PCh. 4 - Prob. 52PCh. 4 - Prob. 53PCh. 4 - Prob. 54PCh. 4 - Prob. 55PCh. 4 - Prob. 56PCh. 4 - Prob. 57PCh. 4 - Prob. 58PCh. 4 - Prob. 59PCh. 4 - Prob. 60PCh. 4 - Prob. 61PCh. 4 - Prob. 62PCh. 4 - Prob. 63APQCh. 4 - Prob. 64APQCh. 4 - Prob. 65APQCh. 4 - Prob. 66APQCh. 4 - Prob. 67APQCh. 4 - Prob. 68APQCh. 4 - Prob. 69APQCh. 4 - Prob. 70APQCh. 4 - Prob. 71APQ
Knowledge Booster
Similar questions
- oncurris 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_forwardU.S. Steel is considering a plant expansion to produce austenitic, precipitation hardened, duplex, and martensitic stainless steel round bars that is expected to cost $15 million now and another $10 million 1 year from now. If total operating costs will be $1.3 million per year starting 1 year from now, and the estimated salvage value of the plant is virtually zero, how much must the company make annually in years 1 through 11 to recover its investment plus a return of 24% per year? The company must make $ ? million annually in years 1 through 11 to recover its investment plus a return of 24% per year.arrow_forwardConcurris 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_forward
- A road resurfacing project costs $250,000, lasts 5 years and saves $150,000 annually in patching costs. MARR is 12%. Determine the annual worth (in $)arrow_forwardDemco Products, a company that manufactures stainless steel control valves, has a fund for equipment replacement that contains $500,000. The company plans to spend $85,000 each year on new equipment. (a) Estimate the number of years it will take to reduce the fund to no more than $85,000 at an interest rate of 10% per year. (b) Estimate the interest rate if it will take 10 years to consume the $500,000-peso fund for the new equipment. Please show your complete solution and explanation. Thank youarrow_forwardA new municipal refuse-collection truck can be purchased for $84,000. Its expected useful life is six years, at which time its market value will be zero. Annual receipts less expenses will be approximately $18,000 per year over the six-year study period. At MARR of 19%, calculate the internal rate of return of the project.arrow_forward
- NEV, Inc. wants to evaluate two new methods that will improve their productivity. Both alternatives have 22 years of service life and NEV uses MARR of 13%. Alternative A has a first cost of $3,315,000 Maintenance cost will start end of year three due to an incentive in the contract with the manufacture that will give free maintenance in the first 2 years. The maintenance cost at end of year three is $42,000 and will increase by $2,700 starting end of year four and continue to increase with the same value thereafter till the end of its service life. A three-times major repair will occur. The first one is at end of year 8 that will cost $56,000, the second one is at end of year 13 and will cost $32,000 and the third and last major repair is $27,500 at end of year 19. The expected revenues from this alternative are $572,000 per year starting end of year 1 and this option will have a salvage value of $840,000 at the end of its service life. Alternative B has a first cost of $2,570,000 and…arrow_forwardThe capitalized cost of $ 10,000 , every 5 years forever, starting now at an interest rate of 10% per year? ( thanks in advance)arrow_forwardAccusoft Systems is offering small business owners a software package that keeps track of many accounting functions from bank transactions to sales invoices. The site license will cost $55,000 to install and will require a fee of $2500 every 3 months. If your company can save $13,500 every quarter and have the security of managing its books in-house, how long will it take for you to recover the investment at an interest rate of 8% per quarter? The time taken to recover the investment is determined to be _______ quarters.arrow_forward
- Determine the capitalized cost of a permanent roadside historical marker that has a first cost of $57500 and a maintenance cost of $1800 once every 6.00 years. Use an interest rate of 11.00% per year. (Include a minus sign if necessary.) The capitalized cost is $.arrow_forwardProfit and loss (in $1000 units) associated with the sale of a vision-guided machine tool loading system and the resulting NCF amounts are recorded. (a) Use sign-change rules to determine the possible number of i* values. (b) Find all i* values between 0 and 100%. (c) If the required MARR for the company is 15% per year, how small can the gradient be for years 3 through 6? Year Cash Flow, $ 0 −5,000 1 −10,100 2 4,500 3 6,500 4 8,500 5 10,500 6 12,500arrow_forwardThe cost of upgrading a section of Grand Loop Road in Yellowstone National Park is $1.7 million. Resurfacing and other maintenance are expected to cost $350,000 every 3 years. What is the capitalized cost of the road at an interest rate of 6% 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:PEARSONEngineering 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 LearningManagerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningManagerial 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