Question

of 10% per year. 2.101 A build to operate (BTO) company signed a year, what year 4? contract to operate several industrial wastewater

treatments plants for 10 years. The contract will pay the company $2.5 million now and amounts increasing by $200,000 each year through year 10. At an interest rate of 10% per year, what is the present worth of the contract now? Solve using (a) tabulated factors, and (b) a spreadsheet.

0 0
Add a comment Improve this question Transcribed image text
Know the answer?
Add Answer to:
of 10% per year. 2.101 A build to operate (BTO) company signed a year, what year...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • A construction company signed a contract to build a highway. The duration of the project is...

    A construction company signed a contract to build a highway. The duration of the project is five years. Based on project's schedule, the company will require 50,000 m² of aggregate each year. The aggregate can be obtained from a nearby query for $5.80 per m². However, the project manager is studying buying the query. If so, the cost of the aggregate would be only $4.30 per m3. Also, the manager thinks that the quarry can be sold at the end...

  • Help with #4 please be $530 per acre-ft, using an interest rate of 10% per year,...

    Help with #4 please be $530 per acre-ft, using an interest rate of 10% per year, a) Determine the difference between present worth (in $/acre-ft) of the old and the new contracts (solve using both formula and spreadsheet functions). b) If new contract also needs a future payment of $2,000 at year 20, what is the equivalent annual worth of the new contract? (solve using both table values and spreadsheet functions) During a period when the real estate market in...

  • Question 1 A construction company signed a contract to build a highway. The duration of the...

    Question 1 A construction company signed a contract to build a highway. The duration of the project is five years. Based on project's schedule, the company will require 50,000 m² of aggregate each year. The aggregate can be obtained from a nearby query for $5.80 per mº. However, the project manager is studying buying the query. If so, the cost of the aggregate would be only $4.30 per mº. Also, the manager thinks that the quarry can be sold at...

  • b. If the company makes the first deposit one year from now, how much should each...

    b. If the company makes the first deposit one year from now, how much should each deposit be? 3. A start-up internet service provider expects to lose money in each of the first four years. Losses are projected to be $50 million in year one, $40 million in year two, $30 million in year three and $20 million in year four. An interest rate of 10% per year is used. a. What is the present worth of the losses for...

  • this is for my engineering economics #2.59 thank you through year b at an interest rate...

    this is for my engineering economics #2.59 thank you through year b at an interest rate of 10% per year? 2.59 Very Light Jets (VLJs) are one-pilot, two-engine jets that weigh 10,000 pounds or less and have only five or six passenger seats. Since they cost half as much as the most inexpensive business jets, they are considered to be the wave of the future. MidAm Charter purchased five planes so that it can initiate service to small cities that...

  • A software company that installs systems for inventory control using RFID technology spent $600,000 per year...

    A software company that installs systems for inventory control using RFID technology spent $600,000 per year for the past 3 years (year 0, year -1, year -2) in developing their latest product. The company wants to recover its investment in 5 years beginning now. If the company signed a contract that will pay $250,000 now and amounts increasing by a uniform amount each year through year 5, (a) how much must the increase be each year? Use an interest rate...

  • #7: A company expects the cost of equipment maintenance to be $5,000 in year one, ss,500 in year two, and amounts increasing by $500 per year through year 10. At an interest rate of 10% per year,...

    #7: A company expects the cost of equipment maintenance to be $5,000 in year one, ss,500 in year two, and amounts increasing by $500 per year through year 10. At an interest rate of 10% per year, the present worth ofthe maintenance cost is nearest to a. $38,220 b. $42,170 C. $46,660 d. $51,790 #7: A company expects the cost of equipment maintenance to be $5,000 in year one, ss,500 in year two, and amounts increasing by $500 per year...

  • Your company has just signed a​ three-year nonrenewable contract with the city of New Orleans for...

    Your company has just signed a​ three-year nonrenewable contract with the city of New Orleans for earthmoving work. You are investigating the purchase of heavy construction equipment for this job. The equipment costs ​$196,000 and qualifies for​ five-year MACRS depreciation. At the end of the​ three-year contract, you expect to be able to sell the equipment for ​$77,000. If the projected operating expense for the equipment is ​$61,000 per​ year, what is the​ after-tax equivalent uniform annual cost​ (EUAC) of...

  • Find cost difference between 2 options using net present worth analysis Your company signed a contract...

    Find cost difference between 2 options using net present worth analysis Your company signed a contract to remove soil from government-owned property. This task requires a specific bulldozer to dig and load the material onto a transportation vehicle. There are two models of ripper-bulldozer to consider: Model Alpha costs $200,000, and two units of model alpha would be required to remove the material within 2 years. Operating cost for each unit would run to $40,000/year for 2000 hours of operation....

  • 1) ABC Pharmaceuticals, a large pharmaceutical company headquartered in the Midwest wants to build a new...

    1) ABC Pharmaceuticals, a large pharmaceutical company headquartered in the Midwest wants to build a new ethanol facility in Nebraska in order to support future increases in demand. The management team of ABC Pharmaceuticals is presented with two different scenarios for its new ethanol facility and will choose the scenario with the greatest net present value. Scenario A: To have the new ethanol facility up and running in 1 year, ABC Pharmaceuticals must invest $2 billion now and will expect...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT