Standby power for pumps at water distribution booster stations can be provided by either gasoline-or diesel-powered engines. The costs for the gasoline engines are as follows: Gasoline First cost, $ Annual M&O, $ per year Salvage value, $ Life, years - 150,000 -41,000 23,000 15 The incremental PW cash flow equation associated with (diesel - gasoline) is 0 = -40,000 + 11,000 (P/A, i, 15) + 16,000(P/F, i, 15) Determine the following: (a) First cost of the diesel engines (b) Annual M&O cost of the diesel engines (c) Salvage value of the diesel engines

The capitalized cost (CC) of the given project whose Cash Flow diagram is given below is closest to:

A manufacturing company has the choice of two suppliers to buy a piece of equipment from to use in its process. Characteristics of these two suppliers and associated costs are tabulated below.  The equipment from supplier A costs more to buy and maintain, but it also has more revenue per unit sold.  Selling enough units will at some point make it worth the higher cost.  How many units per year must the company sell in order to justify using supplier A (i.e. what is the breakeven number of units to sell)?  Use an interest rate of 12% per year.   Supplier A Supplier B Initial cost  $4,000 $3,000 Sale price (revenue per unit) $4 $3 Transportation costs (per unit)  $0 $1.25 Annual maintenance cost $1,400 $1,100 Salvage value $800 $700 Useful life of the equipment (years) 5 4

Equipment needed at Valero Corporation refinery for the conversion of corn stock toethanol, a cleaner burning gasoline additive, will cost $175,000 and have net cashflows of $35,000 the first year, increasing by $10,000 per year over the life of 5 years.Develop a spreadsheet chart that plots AW vs interest rate to show where (what interestrate) the project switches from financially justified to unjustified. Use AW as the verticalaxis of the chart, and interest (i) as the horizontal axis of the chart. Use a range ofinterest rates spanning from 10% to 20%, and use increments of 1%. Label both axesand use a title for the chart.