The rate is 2.75% 5. Copmare the following 2 altrernatives using the Net Equivalent Uniform Annual...
6. Compre the following alternatives using the Net Equivalent Uniform Annual Worth method. Alt. Construction cost $ Life (yrs) A $30million 40 B $35million Infinite
Compare the following 2 alternatives using the Net Present Worth (NPS) method – rate is 3% per year. Draw all cash flow diagrams. Please show work using a formula. Alt. Construction Cost ($) Benefit ($/yr.) Service Life (yrs.) A 380,000 200,000 7 B 450,000 220,000 7
Find the equivalent uniform annual cost 3. Using an interest rate of 12%, find the equivalent miform annual cost for a piece of construction equipment that has an initial purchase cost o $30,000, an estiinat nomic life of 8 years, and an estimated salvage value of $10,000. Annual mainte- nance will anount to $600 per year and periodic overhauls costing $1.,000 each will occur at the end of the second, fourth, and sixth years. 3. Using an interest rate of...
Compare the following alterntives given a market rate of 5.45% per year and an inflation rate of 3% per year. Use first the B/C method to determine feasibility and then the incremental B/C method to determine the oprimum level of investment. Alt Construction Cost $ Annual Benefits $/yr Life yrs A 105,000 40,000 5 B 230,000 52,000 6 C 350,000 64,000 7 D 600,000 100,000 8
Compare the following alterntives given a market rate of 5.45% per year and an inflation rate of 3% per year. Use first the B/C method to determine feasibility and then the incremental B/C method to determine the oprimum level of investment. Alt Construction Cost $ Annual Benefits $/yr Life yrs A 105,000 40,000 5 B 230,000 52,000 6 C 350,000 64,000 7 D 600,000 100,000 8
a) determine which machine should be purchased, based on equivalent uniform annual cost. b) what would be the MACRS depreciation in the third year for machine II? 11-44 A company is considering buying a new piece of machinery. A 10% interest rate will be used in the computations. Two models of the machine are available. sloboibos trolinis ob hoi Machine | Machine II Initial cost odos $100,000 le 25,000 $80,000 od 000. End-of-useful-life 20,000 salvage value, s Annual operating 18,000...
4. Compare the following altemtives given a market rate of 3.45% per year and an inflation rate of 3% per year. Use first the B/C method to determine feasibility and then the incremental B/C method to determine the oprimum level of investment. Life yrs Alt A Construction Costs Annual Benefits S/yr 105,000 40,000 230,000 52.000 350.000 64,000 600,000 100,000 6
5. Compare the following two alternatives by the IRR method, given MARR of 8%/year. Is the incement in cost form A to B justified? Alt. Construction cost | Benefits Styr | Salvage Service Life (yrs 510,000 145,000 10,000 775,000 155,000 20,000
1. A new pipeline is installed. Annual maintenance and pumping costs are considered to be paid in their entireties at the end of the years in which their costs are incurred (assume that maintenance happens in year 10). The pipe has the following costs and properties: Initial cost $7,500 Annual interest rate 5% Service life 10 years Salvage value $500 Annual maintenance $500 Pump cost/hour $2.75 Pump operation 2000 hours/year What is the equivalent uniform annual cost (EUAC) of the pipe?
A telecommunications firm is considering a product expansion of a popular cell phone. Two alternatives for the cell phone expansion are summarized below. The company uses an MARR of 9% per year for decisions of this type, and repeatability may be assumed. L Initial Cost (S) Annual Benefit ($) Salvage Value (S) Useful Life (yrs) Expansion A 148,650.000 1,090,000 10.725,000 Expansion B 63.750,000 2,860,000 12,380,000 1. Which Expansion Option should be taken? Use the Equivalent Uniform Annual Worth Method. You...