City engineers are considering two plans for municipal aqueduct tunnels. They are to decide between the two using an interest rate of 8 percent. Plan A is a full-capacity tunnel that will meet the needs of the city forever. Its cost is $3 000 000 now and $100 000 every 10 years for lining repairs. Plan B involves building a half-capacity tunnel now and a second half-capacity tun- nel in 20 years, when the extra capacity will be needed. Each of the half-capacity tunnels costs $2 000 000. Maintenance costs for each tunnel are $80 000 is also an additional $15 000 per tunnel per year required to pay for extra pumping costs caused by greater friction in the smaller tunnels. (a) Which alternative is preferred? Use a present worth comparison. (b) Which alternative is preferred? Use an annual worth comparison. every 10 years. There

The future value of 1000 Rand for 8% interest rate over 6 years is a certain value. At what interest rate will you get the same future value when you change the period to 3 years for the same 1000 Rand? Hint use goal seek

Ed opened a savings account 5 years ago with $600. The account earns 3% simple interest per year, and Ed has not added or withdrawn from the account. How much interest has Ed earned?

Assume that someone have to pay tuition for four years.  Two years at RCC school and then two years at Northeastern University. Two years at RCC cost $25000 for Two years at Northeastern University $144000 That person then get a fulltime engineering job for $90000/yr.   What is that person own simple payback period and his/her ROI for paying for school in order to get that Engineering job?

What are the Methods for Finding Rate of Return?

Given the following information for an insurance company that writes 24-month term policies: Number of Vehicles 50 100 Policy Group A B Effective Date January 1, 2010 Expiration Date December 31, 2011 July 1, 2010 June 30, 2012 All policies within each group have the same effective date. (a) Calculate the earned car-years for calendar year 2011. (b) Calculate the earned car-years for policy year 2010 evaluated as of December 31, 2010 and as of December 31, 2011. (c) Assume Policy Group B cancels on January 1, 2011. Calculate the 2010 policy year written car- years evaluated as of December 31, 2010 and as of December 31, 2011 for Policy Group B. (d) Assume Policy Group B cancels on July 1, 2011. Calculate the 2010 and 2011 calendar year written car-years for Policy Group B.