Determine which alternative is less costly, based upon comparison of after-tax annual worth. Alternative 1 V Show the AW values used to make your decision: Conveyor 1: $ Conveyor 2: $ -20704 Part b -21056 Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±10. x Your answer is incorrect. Attempts: 2 of 3 used What must the cost of the second (more expensive) conveyor be for there to be no economic advantage between the two?

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A granary has two options for a conveyor used in the manufacture of grain for transporting, filling, or emptying. One conveyor can be
purchased and installed for $95.000 with $1,500 salvage value after 16 years. The other can be purchased and installed for $95,000
with $2,500 salvage value after 16 years. Operation and maintenance for each is expected to be $15,000 and $15,500 per year.
respectively. The granary uses MACRS-GDS depreciation, has a marginal tax rate of 25%, and has a MARR of 9% after taxes.
Click here to access the TVM Factor Table Calculator
Click here to access the MACRS-GDS table.
Part a
Your answer is correct.
Determine which alternative is less costly, based upon comparison of after-tax annual worth. Alternative 1
Show the AW values used to make your decision:
Conveyor 1: $
Conveyor 2: $
Part b
-20704
-21056
Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±10.
x Your answer is incorrect.
Attempts: 2 of 3 used.
What must the cost of the second (more expensive) conveyor be for there to be no economic advantage between the two?
Cost of the second conveyor: $
Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±10.
73944
Transcribed Image Text:A granary has two options for a conveyor used in the manufacture of grain for transporting, filling, or emptying. One conveyor can be purchased and installed for $95.000 with $1,500 salvage value after 16 years. The other can be purchased and installed for $95,000 with $2,500 salvage value after 16 years. Operation and maintenance for each is expected to be $15,000 and $15,500 per year. respectively. The granary uses MACRS-GDS depreciation, has a marginal tax rate of 25%, and has a MARR of 9% after taxes. Click here to access the TVM Factor Table Calculator Click here to access the MACRS-GDS table. Part a Your answer is correct. Determine which alternative is less costly, based upon comparison of after-tax annual worth. Alternative 1 Show the AW values used to make your decision: Conveyor 1: $ Conveyor 2: $ Part b -20704 -21056 Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±10. x Your answer is incorrect. Attempts: 2 of 3 used. What must the cost of the second (more expensive) conveyor be for there to be no economic advantage between the two? Cost of the second conveyor: $ Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±10. 73944
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