Question

2) (30 points) Suppose you are the physical plant manager for a new hotel with many light fixtures. You need to decide if you should use 15 watt LED bulb or a 70 watt A19 halogen bulbs, each giving equivalent amount of lumens of light. The LED bulb costs $3.37 and the A19 halogen blub costs $1.06. The LED lasts 10 years and the A19 halogen bulb last roughly one year, so it will need to be purchased 10 times. (note that the last (10h) halogen bulb will be purchased at the end of year 9 and will be used for Jan. 1 to Dec. 31 of year 10) Assume that each bulb is used 3 hours per day in your house. Search the city of Denton's website (or use some search engine) to find the cost per KWh charged by Denton Municipal Electric for the summer months of 2020 and assume that this will be the charge year round for the next 10 years. (Hint: the costs per kWh will be between 5 cents and 10 cents.) Calculate the present value (use a 4% discount rate) of the lifetime cost of each bulb. You can use this table as a template. It will be easiest to do this in Excel. interest rate 4.00% Cash Outlay for Investing in Lighting Year 0 1 2 314151617181910Total Option A. LED 15 watt 3.37 ? Present Value ? ? B. Halogen 70 watt 1.06 ? Present Value ? ? LLLLLL?
can someone assit me with how to get this problem started in excel?? i would like to figure it out myself. teacher videos are not helping me.

Answer 1

15 watt LED bulb 10 years cost electricity usage life discount rate cost per kWh usage per day 70 watt A hallogen light 3.37 1.06 0.015 0.07 kW 1 year 4% 0.05 dollar or 5 cents 3 hours per day initial outlay for 10 years 3.37 8.9411 1.06(1+PVAF(4%,9))) electricity cost for 1 day electricity cost for 1 year present value of electricity usgae 0.00075 0.27375 $2.22 0.0035 dollar per day 1.2775 dollars (assuming 365 days a year) $10.36 pv(4%,10,-0.27375) and pv(4%,10,-1.27375) assuming electricity bills are paid annually $19.30 total present value for 10 years $5.59 (initial outlay cost + electricity cost) remarks since LED buld is purchased just once in 10 years, one time cost is added hallogen bulb is purchased now and for for 9 years

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