4. Alternative 1–Build gas station Alternative 2-Build soft ice-cream stand FW = Rs. 3,25,85,440 FW = Rs. 2,50,77,560 The future worth of alternative 1 is greater than that of alternative 2. Thus, building the gas station is the best alternative.
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- A flood control pumping station is being designed. Three possible pumping scheme are proposed and the relevant costs are shown in Table Q 2 What is the most economical range of pumping times in hours'year for each scheme? Figure Q2 shows the frequency of pumping demand. What is the most economical scheme? The cost of capital may be taken as 20%. Table Q 2 Costs of alternative scheme Scheme A в Cost of pumps (RM) Life (years) 120,000 180,000 230,000 15 15 20 5, 000 220,000 5, 500 200 ,000 5, 500 Maintenance per annum (RM) Cost of pipes (RM) Life (years) Cost of pumping (RM/hour) 150, 000 20 20 20 50 80 80 10% 30% 40% 20% 1000 2000 3000 4000 5000 Annual pumping hours Frequency of pumpingThe following table shows the past profits of Company X that has just come for sale to the public this month: Year Profit (in thousands $) 2018 140 2017 130 2016 110 2015 120 2014 100 9. If the investment is held at perpetuity, the PV is: a) 1,000 b) 500 c) 800 d) 7002-17 Consider the accompanying breakeven graph for an investment, and answer the following questions. $40 $35 $30 Total Revenue $25 $20- Total Cost $15 $10 -- $5 $0 0. 250 500 750 1000 1250 1500 1750 Output (units/year) (a) Give the equation for total revenue for x units per year. (b) Give the equation for total costs for x units per year. (c) What is the "breakeven" level of x? :11 ou hove a Dollars (X104)
- SUBJECT: ENGINEERING ECONOMICS (a) Identify the Given and the Unknown or what is being asked in the problem (b)Provide the formula to be used (c)Show the complete solution. The final answer is already provided.. At 5% annual interest, what is the difference in the present and future value of P100 paid at the endof each year for 10 years and P100 paid at the beginning of each year? Answer: P value difference = P38.61 F value difference = P62.89A company that makes clutch disks for race cars has the annual net cash flows shown for one department. Year NCF, $1000 0 −65 1 30 2 84 3 −10 4 −12 (a) Determine the number of positive roots to the rate of return relation. (b) Calculate the internal rate of return. Is there a negative root? How is it treated? (c) Calculate the external rate of return using the return on invested capital (ROIC) approach with an investment rate of 15% per year (as assigned by your instructor, solve by hand and/or spreadsheet).A company has $100,000 to spend on the various projects listed. Using these projects only, what should this company consider its minimum attractive rate of return to be? project investment required ($) expected return (%) ABCDEFG I 10,000 25,000 50,000 40,000 25,000 30,000 20,000 14 10 12 16 11 10 12
- You are charged with choosing a vendor to produce a new software that is going to benefit your company. The project has a life cycle of 8 years and MARR of 8% annual interest. Part a.) Draw the cash flow diagram for each vendor. Part b.) Calculate a PW cost for each vendor. Part c.) Indicate which vendor you would choose. Task Development Programming Operation Support Vendor M Cost, $ 200,000 150,000 42,000 20,000 40,000 30,000 Time Frame Now Years 1-4 Now Years 1-3 Years 1-8 Years 1-8 Vendor N Cost, $ Time Frame 70,000 60,000 45,000 50,000 35,000 Now Now Years 1-5 Years 1-8 Years 1-8 Vendor O Cost, $ 150,000 Time Frame Years 1-8Siemens AG invests €80,000,000 to build a manufacturing plant to build wind turbines. The company predicts net cash flows of €16,000,000 per year for the next 8 years. Assume the company requires an 8% rate of return from its investments. (PV of $1. FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.) (1) What is the payback period of this investment? (2) What is the net present value of this investment? Complete this question by entering your answers in the tabs below. Required 1 Required 2 What is the payback period of this investment? Payback Period Choose Numerator: 1 1 Choose Denominator: ‒‒‒ www Next >2. A construction firm plans to purchase new excavator. Two manufacturers offered to the company with the respective estimates below. Descriptions First cost, PhP (in 1000 Php) Annual M&O cost, PhP/ Year (in 1000 Php) Salvage value, PhP Economic life, Years Seller A 15,000 3,500 1,000 6 Seller B 18,000 3,100 2,000 9
- A corporation uses a type of motor truck which costs P 250,000, with life of 2 years and final salvage value P 40,000. If money is worth 4% and using the annual cost method, what should be the life, in years, of another type of truck for the same purpose whose that cost P 312,614 with final salvage value P 50,000? Select one: a. 2.5 b. 4 c. 3.5 d. 3Cell (A) stands for the total cost of 9 units. Its value should be ____. a) 151.65b) 323.52c) 909.80d) 252.75The estimates for a project appear in the following table: Dear optimistic most likely pessimist Fixed cost($) 250,000 250,000 250,000 Annual profit ($) 20,000 15,000 8,000 Shelf life(years) 30 30 30 Residual value($) 000 to. Use the range of values to calculate the heavy average of benefits. b. Using the heavy average, calculate the Equivalent Average Present Value for this project. Use a MARR of 10%. Heavy average annual benefits =$ ; Average Present Value = $