Problem 14.056 The two machines shown are being considered for a chip manufacturing operation. Assume the MARR is a real return of 11% per year and that the inflation rate is 6.7% per year. Machine First Cost, $ M&O, $ per year Salvage Value, $ Life, years A -149,000 B -780,000 -70,000 -5,000 40,000 200,000 5 00 Problem 14.056.a: Compare two alternatives based on their AW values without inflation consideration Which machine should be selected on the basis of an annual worth analysis if the estimates are in constant-value dollars? What is the annual worth of the selected alternative? Select machine B The annual worth of the alternative is $ -113800 Problem 14.056.b: Compare two alternatives based on their AW values with inflation consideration Which machine should be selected on the basis of an annual worth analysis if the estimates are in future dollars? What is the annual worth of the selected alternative? Select machine A The annual worth of the alternative is $ -21400

points Suppose that you invested 88,207AED What is the cquivalent monthly payment you must get in constant dollars? in a small engineering project at 139% (market interest rate). If the general inflation rate is expected to be oi compounded monthly.

A father wants to save in advance for his 8-year old daughter’s college expenses.The daughter will enter the college 10 years from now. An annual amount of$20,000 in today’s dollars (constant dollars) will be required to support the college for 4 years. Assume that these college payments will be made at the beginning of each school year. (The first payment occurs at the end of 10 years). Thefuture general inflation rate is estimated to be 5% per year, and the interest rateon the savings account will be 8% compounded quarterly (market interest rate)during this period. If the father has decided to save only $1,000 (actual dollars) atthe end of each quarter until she goes to college (the last deposit occurs at the endof 10 years) how much will the daughter have to borrow to cover her sophomoreexpenses?(a) $4,120 (b) $4,314(c) $4,000 (d) $4,090

1. A potato chips snack business existing for the past 11 years is to be sold to you by another businessman at 28 Million pesos. It is estimated to last for another 9 years with an annual predicted gross sale of 20.02 million pesos annually and yearly total cost of 1.91 million pesos. Annual inflation rate: around 3.4 to 4.6 %, T-bill rate: around 3.1 to 3.9%. a. Would you buy the said offered business? b. Why? Please show all calculations. 2. The Philippine Government has constructed a new railway system (cost of construction undisclosed). The operation of the said railway system is offered for public bidding at a minimum bid price of 110 Million pesos for a contract of 25 years. Upon diligent research, you have learned that the railways system will yield a yearly net gross income of 34.9 million pesos and a yearly maintenance cost of 3.26 million pesos. Annual average inflation rate is around 2.2 to 4.1% and T-bill rate is 3.8 to 4.3%. a. Would you participate in the bidding process?…