The following data is available for three different alternatives. Assume an interest rate of 10% per year, compounded annually. Initial Cost Annual Benefit Useful Life (yrs) Alternative A 10,000 1,450 infinite Alternative B 11,000 1,930 10 Alternative C 20,000 6,707 5 Alternatives B and C are replaced at the end of their useful lives with identical replacements. Using present worth analysis, find the best alternative.

The following data is available for three different alternatives. Assume an interest rate of 10% per year, compounded annually. Initial Cost Annual Benefit Useful Life (yrs) Alternative A 10,000 1,450 infinite Alternative B 11,000 1,930 10 Alternative C 20,000 6,707 5 Alternatives B and C are replaced at the end of their useful lives with identical replacements. Using present worth analysis, find the best alternative.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Given the following two mutually exclusive alternatives and using repeatability assumption, the correct equation for computing the CW of alternative B is. MARR-15% / year. Capital Investment, $ Market value, $ Annual Expenses, $ Useful life (years) Alternative A -12.000 0 -2,200 10 O CW(15%)-(-40,000-100-(P/A, 15%, 25)+10000(P/F, 15 %. 25))*0.15 O CW(15 %)-(-40,000(A/P. 15%, 25)-1000+10,000(A/F. 15%, 25))/0.15 OCW(15%) - (-40,000(A/P. 15%, 25)-1000+10,000(A/F, 15%, 25))*0.15 OCW(15%)-(-40,000-100-(P/A, 15%, 25 ) +10000 (P/F, 15%, 25))"0.15 Alternative B -40.000 10,000 1,000 25
If you could write out the equation once for me to see where the values should go, that would be helpful. Thank you!
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Consider the comparison between alternatives A and B. Using present worth method of analysis, and at an interest rate of 10% per year, the values of n that you should use in the uniform series factors to make a correct comparison are: A B First Cost ₱500,000 ₱900,000 Annual Operating Cost ₱100,000 ₱40,000 Salvage Value ₱130,000 ₱150,000 Life 3 years 6 years a. n=3 years for A and n=3 years for B b. n=3 years for A and n=6 years for B c. n=6 years for A and n=6 years for B d. n=6 years for A and n=3 years for B
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A city government feels that the energy production capacity must be expanded to meet anticipated demands for energy. There are three alternatives to consider: @A nuclear facility with an investment of $250 million, operating costs of $3 million per year and life of 20 years. @ A coal plant with an investment of $200 million operating costs of $10 million per year and a life of 20 years. 26°C I P Type here to search
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