Question

EXAMPLE 3 o Assuming a cost of $3000 for a system that supplies of the hot water demand ( AT 70°F) of 80 gallons a day, oil at $1.80 gal, (E-140,000 Btu/gal) and water heater efficiency of 70%, how long is the pay back time 94

Answer 1

GIVEN:-1) COST OF THE SYSTEM= $ 3000

2) SUPPLY PER DAY = (3/4) OF DEMAND OF 80 GALLONS= (3/4) * 80 = 60 GALLONS PER DAY

3) RATE OF OIL= $1.8 PER GALLON

4) EFFICIENCY OF THE HEATER= 70%

TO FIND:- PAY BACK TIME

SOLUTION:- The total cost of the system is $ 3000 . Now to earn back this much amount of money , let the number of days be x . If we can calculate the earning of one day , then we can easily find out the number of days required to earn $3000 and that will be the pay back time .

Now to calculate the earning in one day , the number of gallons of oil supplied in one day multiplied by the cost of one gallon of oil should give us the required earning in one day if it was an ideal heater with 100% efficiency . But the efficiency of the heater is 70 % so the earning will also be 70% of the ideal in a day i.e.

the total earning in a day = number of gallons of oil supplied in a day * rate of oil per gallon * efficiency of the heater

= 60 * 1.8 * 0.7 = $ 75.6

Now to calculate the pay back period , we can divide the total money by the money earned in one day to get the number of days as pay back period as shown (refer image) :

dem and 3 Tate 어 ou talculaHa he tanning Ljome da Qup! ל8000 39.6 8

Thus the pay back time comes out to be = 40 days .............................................................(ANSWER)