Question

Compact fluorescent lamps (CFLs) have become required in recent years, but do they make financial sense? Suppose a typical 60-watt incandescent light bulb costs $.46 and lasts 1,000 hours. A 15-watt CFL, which provides the same light, costs $3.45 and lasts for 12,000 hours. A kilowatt-hour of electricity costs $.122, which is about the national average. A kilowatt-hour is 1,000 watts for 1 hour. If you require a return of 11 percent and use a light fixture 500 hours per year, what is the equivalent annual cost of each light bulb? (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

This is all that I have been given

Answer 1

Bulb	cost ($)	Last for (hrs)	will go for (years)	Average cost (per year)
60 watt	$0.46	1000	2	$0.23
15 watt CFL	$3.45	12000	24	$0.14
1 kilo watt	$0.12	1000	2	$0.06
Fixed consumption		500

Therefore, the average cost of 60 watt is $0.23. 15 watt is $0.14 and 1 kilo watt is $0.06