ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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- Question 1 A design firm is considering multiple independent projects for the upcoming quarter. For a MARR of 6.5% per quarter. What is your recommendation to the company based on a PW analysis? Project Initial Payment Monthly Costs (Today) A $1,500,000 $170,000 B $245,000 $200,000 C $300,000 $150,000 Payments are inflows for the design firm. Costs are outflows for the design firm. Payment at month 12 of $1,000,000 Costs at month 9 of $100,000 None Final Payment (At end of project) $3,000,000 Project Length Other Cash flows 2 years $3,000,000 18 months $4,000,000 30 monthsarrow_forwardGiven 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 25arrow_forwardQuestion 2 Full explain this question and text typing work only do not ignore this linearrow_forward
- For the following 4 options (one must be chosen), what is the smallest MARR for the "Do Nothing" option to be chosen? Option A Year O Cost ($) Years 1-10 Benefit ($) 5.26% 9.59% 7.09 % 10.69% "Do Nothing" 0 O -1,000 153 B -1,500 207 C -2,000 261arrow_forwardwhat's the PW of Alternative A and B?arrow_forwardGiven the data for three different alternatives in the table below, determine the best alternative using the incremental rate of return (∆RoR) analysis. MARR =9%. A B C First cost $15,000 $25,000 $20,000 O &M Cost/ year 1,600 400 900 Benefit/year 8,000 13,000 9,000 Salvage value 3,000 6,000 4,600 Life in years 4 4 4 The better alternative between the second increment (B – C) is:. Group of answer choices Alt. B Alt. C Alt. B or Alt. C Alt. Aarrow_forward
- Which increment should be examined first in incremental rate of return analysis, if MARR = 10.0%? Do-nothing A B C D First cost 0 $8,000 $4,500 $8,500 $6,000 Annual 0 1,387 914 1,661 935 benefit Life 10 yrs ROR 11.5% 15.5% 14.5% 9.0% A-B OB-A OA-C OB-Carrow_forwardA sportswear factory has two alternative machines for producing jerseys. Costs are shown below. Minimum acceptable rate of return is 8%.What is the annual cost for machine Y?arrow_forwardCan someone please help me to solve this problem with neat hand calculations. Please and thank you!!arrow_forward
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