3. Compare the following 2 altrernatives using the Benefit/Cost Ratio method in terms of the Net Equivalent Uniform Annual Worth method. Note: for the present worth method, the analysis period must be the same for both alternatives (i.e., 14 yrs). Alt. A B Construction cost $ 1,450,000 1,600,000 Benefits $/yr 580,000 610,000 Salvage $ 100,000 200,000 Service Life (yrs) 7 14
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interest rate = 5% / yr. Please no excel work, I want to see how it is solved BY HAND. Thanks
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- Calculate the annual worth uniform series in years 1 through 10 for the following incomes and expenses, If the interest rate is 1596 per year. Expense, S/Year 10,000 2,000 Year Income, S/Y ear 1-6 7,000 7-10 1,000 2,000 Selected Answer: 3 [None Given] Correct Answer: $1,532Would love some help on how to approach this - thanks! The cash flows for three different alternatives are given in table below. MARR =10%. Alt. A Alt. B Alt. C Initial cost $5,000 9,000 7,500 Annual benefits $1,457 2,518 2,133 RoR 14% 13% 12.4% Life in years 5 1. ΔRoR for the first increment (Alt. C-Alt. A) is ___________________. A.10.12% B. 9.38% C. 11.85% D. 11.00% 2. ΔRoR for the second increment is ___________________. A. 10.12% B. 9.38% C. 8.94% D. 9.87% 3. The best alternative for a MARR of 10% using the incremental rate of return analysis is ____________. A. Alt. C B. Alt. A C. Alt. B D. Do nothingTRUE OR FALSE The future worth of a perpetuity from one (1) to ? years is undefined because as ? approaches infinity, the valuebecomes 0. The breakeven point always maximizes the profit.
- Smith Equipment has three separate shipments to customers all in the same city. The shipment welights are 20,000 Ibs. 25,000 bs, and 10,000 ibs. Smith Equipment's carrier charges $14 per hundredwelght (cwt) if each shipment is sent separately. If the three shipments are consolidated at Smith Equipment's warehouse and sent in a single truck, the carrier charges $11 per cwt with a $500 consolldated dellvery fee per destination added. Assume the carrler promises one-day delivery on the separate shipments, and two-day dellvery on the consoldated shipment. If shorter delivery time is important to these customers, Smith Equipment should Multiple Choice O consolidate the shipments because the savings is substantial O consolidate the shipments even though the savings are minimal send the shipments separately even though this is asightly more expensive option send the shipments separately even though this is a significantly more expensive optionThe cash flows for three mutually exclusive alternatives are given in table below. MARR = 4%. ALB Alt. C 27,000 24,000 7,600 6,500 13% 11% Initial cost Annual benefits ROR Life in years Alt. A $15,000 $4,500 15% 5 Reference: Case Study 8 The best alternative for a MARR of 2.0% using the incremental rate of return analysis is A. Alt. C B. Alt. B C. Alt. A OD.Do-nothingA project is being planned that has an initial investment at time 0, annual revenuesand expenses, and a salvage value at the end of the project lifespan (20 years). The financialvalues are summarized below:Initial investment amount at time 0 $150,000Estimated annual revenue $34,500 per yearEstimated annual expenses $8,700 per yearEstimated salvage value at end of lifespan $10,000Minimum attractive rate of return (MARR) 15%a. Calculate the capital recovery amount CR(i%).b. Using the annual worth (AW) method, determine whether purchasing the equipmentis economically justified.c. Repeat part (a) using the internal rate of return (IRR) method based on annual worth(AW).d. Using the present worth (PW) method, determine the break-even time period afterwhich purchase of the equipment generates a profit. (Find N when PW = 0) year period.
- Chambers Company has just gathered estimates forconducting a break-even analysis for a new product.Variable costs are $7 a unit. The additional plant willcost $48,000. The new product will be charged $18,000a year for its share of general overhead. Advertisingexpenditures will be $80,000, and $55,000 will be spenton distribution. If the product sells for $12, what is thebreak even point in units? What is the break even pointin dollar sales volume?:[A] { > Incremental analysis ([ B Alternative], [B wins ]): C A company considering 2 different machines at MARR at 12% Both life spans = 10 years Initial Cost Annual Operating lost Benefits per yin ar Salvage Value \table MM If you are and of frying investment to company decide More than 2 alternatives if the additional increment is worth while, compare Alternative: A Incremental analysis (Alternative) pairs then B C A MARR Company at Considering 2 different machines at 12% Both life spans = 10 years. M/C X м/с у Initial Cost 160000 285000 Annual Operating Cost Benefits per year Salvage Value 45 000 90000 45000 105000 20000 40000The net present value method does not incorporate the time value of money. O True O False
- Brand A B 5:21 PM C D 2 years 3 years $13 4 years $17 5 years Which brand should the engineer select if the MARR is 9% a year? Cost m October 7, 2023 17:17 $7 2. An electrical engineer has to choose one brand of light bulbs among four available brands. The following information are available; lifetime $9 VPN G 4G+ LTE 22 8 0Given cash flows for two alternatives as shown in table below, choose the most attractive alternative if MARR = 8%. Year 0 1 2 3 through ∞ Alt. A -$42K $3.6K $3.6K $3.6K Alt. B -$54K $4.7K $4.7K $4.7K Group of answer choices Alt. A Alt. B Select neither Select eitherTime left 1:24:36 FW analysis comparison of alternatives is different from PW analysis. For example: Must compare alternatives for equal service. Select one: O a. False O b. True on Machines that have the following costs are under consideration for a robɔtized welding process. Using an interest rate of 10% per year, determine which alternative should be selected on the basis of a present worth analysis. Machine X Machine Y First Cost. S -250,000 -430.000 AOC. S per year -60.000 -40,000 Salvage Value. S 70,000 95.000 Life vears 3 Oa Select Machine X b. Select Machine Y O b. Select Machine Y Approximately, what is the value of (P) if A=380, n=11 years, and i= 10% per year? a. 2049 O b. 2468 C. 3308 O d. 2962