Homework Answers
Present value of geometric series = A * [1 - (1+g)^n / (1+i)^n] / (i - g)
Present value of air conditioning cost = 8800 * [1 - (1+0.1)^15 / (1+0.18)^15] / (0.18 - 0.1)
= 8800 * [1 - (1.1)^15 / (1.18)^15] / 0.08
= 8800 * 8.139159
= 71624.61
Present value of maint. cost = 345 * 1.15 * [1 - (1+0.15)^15 / (1+0.18)^15] / (0.18 - 0.15)
= 396.75 * [1 - (1.15)^15 / (1.18)^15] / 0.03
= 396.75 * 10.980828
= 4237.62
Total Present value = 71624.61 + 4237.62 = 75862.23
Equivalent annual cost = 75862.23 * (A/P, 18%,15)
= 75862.23 * 0.196403
= 14899.55 ~ 14900
Add Answer to:
12- A small company pays $ 8,000 per year on electricity for the air conditioning purpose....
A small company heats its building and spends $8,000 per year on natural gas for this...
A small company heats its building and spends $8,000 per year on natural gas for this purpose. Cost increases of natural gas are expected to be 10% per year starting one year from now (i.e., the first cash flow is $8,800 at EOY one). Their maintenance on the gas furnace is $345 per year, and this expense is expected to increase by 15% per year starting one year from now (i.e., the first cash flow for this expense is $396.75...
A small company heats its building and spends $7,800 per year on natural gas for this...
A small company heats its building and spends $7,800 per year on natural gas for this purpose. Cost increases of natural gas are expected to be 9% per year starting one year from now (i.e., the first cash flow is $8,502 at EOY one). Their maintenance on the gas furnace is $345 per year, and this expense is expected to increase by 15% per year starting one year from now (i.e., the first cash flow for this expense is $396.75...
Problem 4-88 (algorithmic) 3 Question Help A small company heats its building and spends $8,500 per...
Problem 4-88 (algorithmic) 3 Question Help A small company heats its building and spends $8,500 per year on natural gas for this purpose. Cost increases of natural gas are expected to be 10% per year starting one year from now (i.e., the first cash flow is $9,350 at EOY one). Their maintenance on the gas furnace is $345 per year, and this expense is expected to increase by 12% per year starting one year from now (i.e., the first cash...
A small company heats its building and will spend $8938 in year 1 on natural gas...
A small company heats its building and will spend $8938 in year 1 on natural gas for this purpose. Cost increases of natural gas are expected to be 9% per year starting year 2. Their maintenance on the gas furnace is going to be $391 in the first year and this expense is expected to increase by 15% per year starting year 2. If the planning horizon is 13 years, what is the total annual equivalent expense for operating and...
A small company heats its building and will spend $9,020 in year 1 on natural gas...
A small company heats its building and will spend $9,020 in year 1 on natural gas for this purpose. Cost increases of natural gas are expected to be 10% per year starting year 2. Their maintenance on the gas furnace is going to be $396.75 in the first year and this expense is expected to increase by 15% per year starting year 2. If the planning horizon is 15 years, what is the total annual equivalent expense for operating and...
A small company heats its building and will spend $9,156 in year 1 on natural gas...
A small company heats its building and will spend $9,156 in year 1 on natural gas for this purpose. Cost increases of natural gas are expected to be 9% per year starting year 2. Their maintenance on the gas furnace is going to be $391.00 in the first year and this expense is expected to increase by 15% per year starting year 2. If the planning horizon is 14 years, what is the total annual equivalent expense for operating and...
3. A manufacturing company is planning to install an air-conditioning system at its main office. The...
3. A manufacturing company is planning to install an air-conditioning system at its main office. The company receives two offers, System A and System B. Both systems are suitable for use by the company. The costs of both systems are tabulated in TABLE Q3. Assume both systems will provide comparable comfort service and will be used for 10 years. Interest rate is 10%. The air-conditioning will only be operated from year 2 onwards. TABLE Q3 No System A (RM) 55,000...
Econo-Cool air conditioners cost $355 to purchase, result in electricity bills of $161 per year, and...
Econo-Cool air conditioners cost $355 to purchase, result in electricity bills of $161 per year, and last for 5 years. Luxury Air models cost $555, result in electricity bills of $122 per year, and last for 8 years. The discount rate is 20%. a. What is the equivalent annual cost of the Econo-Cool model? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Econo-Cool Equivalent annual cost b. What is the equivalent annual cost of the Luxury...
Econo-Cool air conditioners cost $320 to purchase, result in electricity bills of $154 per year, and...
Econo-Cool air conditioners cost $320 to purchase, result in electricity bills of $154 per year, and last for 5 years. Luxury Air models cost $520, result in electricity bills of $108 per year, and last for 8 years. The discount rate is 25%. a. What is the equivalent annual cost of the Econo-Cool model? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Econo-Cool Equivalent annual cost b. What is the equivalent annual cost of the Luxury...
Econo-Cool air conditioners cost $320 to purchase, result in electricity bills of $154 per year, and...
Econo-Cool air conditioners cost $320 to purchase, result in electricity bills of $154 per year, and last for 5 years. Luxury Air models cost $520, result in electricity bills of $108 per year, and last for 8 years. The discount rate is 25% a. What is the equivalent annual cost of the Econo-Cool model? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Econo-Cool Equivalent annual cost b. What is the equivalent annual cost of the Luxury...
A small company heats its building and spends $8,000 per year on natural gas for this purpose. Cost increases of natural gas are expected to be 10% per year starting one year from now (i.e., the first cash flow is $8,800 at EOY one). Their maintenance on the gas furnace is $345 per year, and this expense is expected to increase by 15% per year starting one year from now (i.e., the first cash flow for this expense is $396.75...
Problem 4-88 (algorithmic) 3 Question Help A small company heats its building and spends $8,500 per year on natural gas for this purpose. Cost increases of natural gas are expected to be 10% per year starting one year from now (i.e., the first cash flow is $9,350 at EOY one). Their maintenance on the gas furnace is $345 per year, and this expense is expected to increase by 12% per year starting one year from now (i.e., the first cash...
A small company heats its building and will spend $9,156 in year 1 on natural gas for this purpose. Cost increases of natural gas are expected to be 9% per year starting year 2. Their maintenance on the gas furnace is going to be $391.00 in the first year and this expense is expected to increase by 15% per year starting year 2. If the planning horizon is 14 years, what is the total annual equivalent expense for operating and...
3. A manufacturing company is planning to install an air-conditioning system at its main office. The company receives two offers, System A and System B. Both systems are suitable for use by the company. The costs of both systems are tabulated in TABLE Q3. Assume both systems will provide comparable comfort service and will be used for 10 years. Interest rate is 10%. The air-conditioning will only be operated from year 2 onwards. TABLE Q3 No System A (RM) 55,000...
Econo-Cool air conditioners cost $355 to purchase, result in electricity bills of $161 per year, and last for 5 years. Luxury Air models cost $555, result in electricity bills of $122 per year, and last for 8 years. The discount rate is 20%. a. What is the equivalent annual cost of the Econo-Cool model? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Econo-Cool Equivalent annual cost b. What is the equivalent annual cost of the Luxury...
Econo-Cool air conditioners cost $320 to purchase, result in electricity bills of $154 per year, and last for 5 years. Luxury Air models cost $520, result in electricity bills of $108 per year, and last for 8 years. The discount rate is 25%. a. What is the equivalent annual cost of the Econo-Cool model? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Econo-Cool Equivalent annual cost b. What is the equivalent annual cost of the Luxury...
Econo-Cool air conditioners cost $320 to purchase, result in electricity bills of $154 per year, and last for 5 years. Luxury Air models cost $520, result in electricity bills of $108 per year, and last for 8 years. The discount rate is 25% a. What is the equivalent annual cost of the Econo-Cool model? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Econo-Cool Equivalent annual cost b. What is the equivalent annual cost of the Luxury...
Most questions answered within 3 hours.
-
Random characters You decide to create a program characters.py
that fills a two-dimensional list with random...
asked 4 minutes ago -
What are the major sources of error in your determination of the
molar mass? Select all...
asked 7 minutes ago -
A. Suppose your manager indicates that for a normally
distributed data set you are analyzing, your...
asked 29 minutes ago -
During the month of August, the average temperature of a lake
next to a local college...
asked 10 minutes ago -
Which of these four researchers is most likely to have made Type
1 error
Kim who...
asked 24 minutes ago -
In a performance test, each of two cars takes 8.9 s to
accelerate from rest to...
asked 25 minutes ago -
Sapphire Aerospace operates 52 weeks per year, and its cost of
goods sold last year was...
asked 28 minutes ago -
Create ER Model
Assets are resources that are used in CMS to display content.
Each asset...
asked 23 minutes ago -
For each the following molecules draw the best possible
structure based on formal charges for each...
asked 29 minutes ago -
A proton moves in the plane of this paper toward the top of the
page. A...
asked 38 minutes ago -
different divisions differing lines of business use
different costs of capital because their cost of equity...
asked 35 minutes ago -
Give an algorithm to determine whether or not the elements
of
an array of integers are...
asked 42 minutes ago