Question

I need help with question 7.12. I looked at the step-by-step solution for that one but someone posted a comment saying that the answer is wrong and no one has commented on what the correct answer should be

201 Problems Determination of ROR 7.7 If a manufacturer of slectronic devices invests S650,000 in equipment for making compact piezo electric accelerometers for general purpose vibra Lion measurement estimate the rate of return from revenue of $225.000 per year for 10 years and $70.000 in salvage value from the used equipment sale in year 10. Solve by (a) factors, and (b) spread- shoot function. S105,000 per year for the 5 years. The equipment now has a salvage value of $50,000 (a) What is the rate of return per year on the investment? (b) The owner expected to make at least 15% per year on this quality improvement investment What annual savings were necessary to meet the 15 goal? 7.8 Use factors and a spreadsheet to determine the in- terest rate per period from the following equation: 0 -40,000 + 8000(P/A. 5) + 8000(P/F/8) Determine i per year for the cash flows shown using factors and the IRR function. (Note: See Problem 7.55 for additional spreadsheet work with this series) 7.13 Over a 7-year period, the number of uninsured mo Borists in New Mexico dropped from 335 to 10% because an up-to-date computer database allowed the state to better police its requirements for car and track liability insurance. Assuming the de crease occurred uniformly and compounded annu- ally, what was the annual rate of the decrease! 7.9 2.14 What rate of return per month will an entrepreneur make over a 29-year project period if he invested SI 50,000 to produce portable 12-volt air compres- sors? His monthly costs are $27.000 and his reve- nues are $31.000 7.10 7.15 Year o 3 4 Cash Flow, O -80,000 9000 70.000 10.000 The Camino Real Landfill was required to installa plastic liner to prevent leachate from migrating into the groundwater. The fill area was 500 m and the installed liner cost was S8 per m'. In order to recover the investment, the owner charges to un load at the rates of SIO per pick-up, S25 per dump- truck, and S70 per compactor truck load. The fill area is adequate for 4 years. If the annual traffic is estimated to be 2500 pick-up loads, 650 dump- truck loads, and 1200 compactor-truck loads, what rate of return will the landfill owner make on the investment? Swagelok Enterprises is a manufacturer of minia- ture fittings and valves. Over a 5-year period, the costs associated with one product line were as fol- lows: first cost of $30,000 and annual costs of S18,000. Annual revenue was $27.000 and the used equipment was salvaged for S-4000. What rate of return did the company make on this product? 7.16 Abroadband service company borrowed 52 mil- lion for new equipment and repaid the loan in amounts of $200,000 in years 1 and 2 plus a lump- sum amount of 52.2 million at the end of year 3. What was the interest rate on the loan? 7.11 Determine the rate of return for the following cash flow series 13.000 7.17 Barron Chemical uses a thermoplastic polymer to enhance the appearance of certain RV panels. The initial cost of one process was $120,000 with an- nual costs of $49.000 and revenues of $78,000 in year I increasing by S1000 per year. A salvage value of $20,000 was realized when the process was discontinued after 8 years. What role of return did the company make on the process? Solve by trial and crror and verify by spreadsheet 00 10 7.18 Stoel cable barriers in highway medians are a low- cost way to improve traffic safety without over stressing department of transportation budgets. Cable barriers cost $44,000 per mile, compared with $72.000 per mile for guardrail and 5419,000 per mile for concrete barriers. Furthermore, cable barriers tend to snag tractor-trailer rigs, keeping them from ricocheting back into same-direction traffic. The state of Ohio spent $4.97 million in- stalling 113 miles of cable barriers. Answer the 7.12 Jamison Specialties manufactures programmable incremental encoders that resist shock and vibra- tion for use in harsh environments. Five years ago. the company invested $650,000 in an automated quality control system and recorded savings of

Answer 1

650 ovUlos oco (P/A ,+50suvu(P O -) -0.03 -2. + A(PIA 1S, s)4 Soo (PIAIS, s O 650 ceo A(2 252) 5o000 o.14) 650000 $186, 492 A -