Homework Answers
Using RATE function in Excel
| Investment Considered | (A-DN) | (C-A) | (B-C) |
| Investment cost | -15000 | -2000 | -3500 |
| Annual Revenue | 4000 | 900 | 450 |
| Annual costs | -1000.0 | -150 | -100 |
| Market value | 6000 | -2220 | 3300 |
| Incremental IRR | 12.7% | 10.5% | 9.2% |
As incremental IRR > MARR, Alternative B should be selected
Showing formula in excel
| Investment Considered | (A-DN) | (C-A) | (B-C) |
| Investment cost | -15000 | -2000 | -3500 |
| Annual Revenue | 4000 | 900 | 450 |
| Annual costs | -1000 | -150 | -100 |
| Market value | 6000 | -2220 | 3300 |
| Incremental IRR | =RATE(6,(AC23+AC24),AC22,AC25) | =RATE(6,(AD23+AD24),AD22,AD25) | =RATE(6,(AE23+AE24),AE22,AE25) |
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For the following table, assume a MARR of 9% per year and a useful life for...
For the following table, assume a MARR of 9% per year and a useful life for each alternative of six years that equals t...
For the following table, assume a MARR of 9% per year and a useful life for each alternative of six years that equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Do Nothing A CB. Complete the IRR analysis by selecting the preferred alternative. Do Nothing A A C CB - $15,000 A Capital investment A Annual revenues A Annual costs - $3,250 - $2,000 4,000 900 460 -1,000 6,000 - 150...
NOT IN EXCEL 7.For the following table assume a MARR of 6% per year, and a...
NOT IN EXCEL
7.For the following table assume a MARR of 6% per year, and a useful life for each alternative of six years. Which equals the study period. The rank order of alternatives from least capital to greatest capital investment is A, C, B. Complete the PW-Incremental Analysis by selecting the preferred alternative. (5ptos) V A Capital Investment A Annual Revenues A Annual Cost A Market Value APW A $15,000 4,000 1,000 6,000 $3,982 A(C-A) A(B-C) $2,000 $3,000 900...
For the following table, assume a MARR of 12% per year and a useful life for...
For the following table, assume a MARR of 12% per year and a useful life for each alternative of eight years which equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Z ·Y? W? X Complete the incremental analysis by selecting the prefer ed altemative. Do nothing" is not an option. $250 $400 $100 Capital investment ? Annual cost savings ? Market value ? PW (12%) 70 100 138 90 50 67...
engineering economy QUESTION 2 The following mutually exclusive investment alternatives have been presented to you A...
engineering economy
QUESTION 2 The following mutually exclusive investment alternatives have been presented to you A B C E Capital investment $60,000 $90,000 $40,000 $30,000 $70,000 Annual expenses $30,000 $40,000 $25,000 $15,000 $35,000 Annual revenues $50,000 $52,000 $38,000 $28,000 $45,000 MV at EOY 10 $15,000 $15,000 $10,000 $10,000 $15,000 IRR 31.5 % 7.4 % 30.8 % 42.5 % 9.2 % The life span of all alternatives is 10 years.. Using a MARR of 15 % per year, what is the...
1. Compare the ME alternatives below using an MARR of 10% per year. Assume that "do...
1. Compare the ME alternatives below using an MARR of 10% per year. Assume that "do nothing" is NOT an option. Pick the better alternative using AW analysis Alternative Initial cost, $ Annual operating cost, $ Life, years 60,000 21,000 400,000 5,000 'forever
Consider the mutually exclusive alternatives given in the table below. MARR is 8 % per year....
Consider the mutually exclusive alternatives given in the table below. MARR is 8 % per year. Assuming repeatability, what is the equivalent annual worth of the most profitable alternative? (Do not enter the dollar sign $ with your answer.) _____________________________________________________________ X Y Z _____________________________________________________________ Capital investment $80,000 $40,000 $64,000 Annual savings $24,000 $12,800 $19,200 Useful life (years) 8 12 16
Please DO NOT use excel. Show all steps please. You have 2 mutually exclusive alternatives and a MARR of 9%. Which alternative is preferred, based on repeatability assumption? Alternative E F Cap...
Please DO NOT use excel. Show all steps please. You have 2 mutually exclusive alternatives and a MARR of 9%. Which alternative is preferred, based on repeatability assumption? Alternative E F Capital Investment $14,000 $65,000 Annual Expenses $14,000 $9,000 Useful Life (years) 4 20 Market Value at end of useful life $8,000 $13,000
Compare alternatives A and B with the present worth method if the MARR is 10% per year. Which one would you recommend? Assume repeatability and a study period of 20 years $15,000 $45,000 Capital Inve...
Compare alternatives A and B with the present worth method if the MARR is 10% per year. Which one would you recommend? Assume repeatability and a study period of 20 years $15,000 $45,000 Capital Investment Operating Costs $4,000 at end of year 1 and increasing by $400 per year thereafter $4,000 every 5 years 20 years $8,000 at end of year 1 and increasing by $800 per year thereafter None Overhaul Costs Life 10 years Salvage Value $8,000 if just...
The following mutually exclusive investment alternatives have been presented to you. The life of all alternatives...
The following mutually exclusive investment alternatives have been presented to you. The life of all alternatives is 10 years. A В C Capital investment Annual expenses $60,000 $90,000 $40,000 $30,000 $70,000 35,000 45,000 15,000 30,000 40,000 25,000 16,000 Annual revenues 50,000 52.000 38,000 28,000 Market value at EOY 10 15,000 10,000 10,000 39.0% 10,000 IRR ??? 7.4% 30.8% 9.2% After the base alternative has been identified, the first comparison to be made in an incremental analysis should be which of...
do step by step 5. Complete the following table to find the economic life of the...
do step by step
5. Complete the following table to find the economic life of the asset, having these cash flow estimates: (15 ptos) 12) Capital Investment = $40,000 Market Value (MV) - $12.000 all the time Annual Expenses coy(1)$4,000 coy(2)$6,000, coy(3) 8.000, The MARR is 8% per year. ( MARR) (3] [4 [5] [6] MV, MV.1 - MV * MV. Ex TC031141151 EOYK Market Loss in Cost of Annual Total Cost Value Market Capital Expense 40,000 12.000 4.000 12,000...
For the following table, assume a MARR of 9% per year and a useful life for each alternative of six years that equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Do Nothing A CB. Complete the IRR analysis by selecting the preferred alternative. Do Nothing A A C CB - $15,000 A Capital investment A Annual revenues A Annual costs - $3,250 - $2,000 4,000 900 460 -1,000 6,000 - 150...
NOT IN EXCEL
7.For the following table assume a MARR of 6% per year, and a useful life for each alternative of six years. Which equals the study period. The rank order of alternatives from least capital to greatest capital investment is A, C, B. Complete the PW-Incremental Analysis by selecting the preferred alternative. (5ptos) V A Capital Investment A Annual Revenues A Annual Cost A Market Value APW A $15,000 4,000 1,000 6,000 $3,982 A(C-A) A(B-C) $2,000 $3,000 900...
For the following table, assume a MARR of 12% per year and a useful life for each alternative of eight years which equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Z ·Y? W? X Complete the incremental analysis by selecting the prefer ed altemative. Do nothing" is not an option. $250 $400 $100 Capital investment ? Annual cost savings ? Market value ? PW (12%) 70 100 138 90 50 67...
engineering economy
QUESTION 2 The following mutually exclusive investment alternatives have been presented to you A B C E Capital investment $60,000 $90,000 $40,000 $30,000 $70,000 Annual expenses $30,000 $40,000 $25,000 $15,000 $35,000 Annual revenues $50,000 $52,000 $38,000 $28,000 $45,000 MV at EOY 10 $15,000 $15,000 $10,000 $10,000 $15,000 IRR 31.5 % 7.4 % 30.8 % 42.5 % 9.2 % The life span of all alternatives is 10 years.. Using a MARR of 15 % per year, what is the...
1. Compare the ME alternatives below using an MARR of 10% per year. Assume that "do nothing" is NOT an option. Pick the better alternative using AW analysis Alternative Initial cost, $ Annual operating cost, $ Life, years 60,000 21,000 400,000 5,000 'forever
Compare alternatives A and B with the present worth method if the MARR is 10% per year. Which one would you recommend? Assume repeatability and a study period of 20 years $15,000 $45,000 Capital Investment Operating Costs $4,000 at end of year 1 and increasing by $400 per year thereafter $4,000 every 5 years 20 years $8,000 at end of year 1 and increasing by $800 per year thereafter None Overhaul Costs Life 10 years Salvage Value $8,000 if just...
The following mutually exclusive investment alternatives have been presented to you. The life of all alternatives is 10 years. A В C Capital investment Annual expenses $60,000 $90,000 $40,000 $30,000 $70,000 35,000 45,000 15,000 30,000 40,000 25,000 16,000 Annual revenues 50,000 52.000 38,000 28,000 Market value at EOY 10 15,000 10,000 10,000 39.0% 10,000 IRR ??? 7.4% 30.8% 9.2% After the base alternative has been identified, the first comparison to be made in an incremental analysis should be which of...
do step by step
5. Complete the following table to find the economic life of the asset, having these cash flow estimates: (15 ptos) 12) Capital Investment = $40,000 Market Value (MV) - $12.000 all the time Annual Expenses coy(1)$4,000 coy(2)$6,000, coy(3) 8.000, The MARR is 8% per year. ( MARR) (3] [4 [5] [6] MV, MV.1 - MV * MV. Ex TC031141151 EOYK Market Loss in Cost of Annual Total Cost Value Market Capital Expense 40,000 12.000 4.000 12,000...
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