Evaluate the two machines below, using ROR analysis. Which machine should be selected, if MARR is 10%? Remember, the ROR equation should be set up to ensure equal service. Mach A Mach B First cost (S) AOC ($) -15,000 -25,000 -1,600 -400 Salvage value (4) Life (yrs) 3,000 6,000 6.

Evaluate the two machines below, using ROR analysis. Which machine should be selected, if MARR is 10%? Remember, the ROR equation should be set up to ensure equal service. Mach A Mach B First cost (S) AOC ($) -15,000 -25,000 -1,600 -400 Salvage value (4) Life (yrs) 3,000 6,000 6.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: The engineering department have appointed you on a task purchasing new forklift to transport sheet…

A: Given Information: Item Forklift A Forklift B First Cost , RM 90,000…

Q: Evaluate a combined cycle power plant on the basis of the FW method when the MARR is 12% per year.…

A: Formula: FW = present worth * (F/A, I,n)

Q: Question 8 Two processes can be used for producing a polymer that reduces friction loss in engines,…

A: Interest rate= 10% For process A First cost= $1,179,136 Annual operating cost per year= $80,727…

Q: You have been asked to evaluate two alternatives, X and Y, that may increase plant capacity for…

A: Present value table method is a method which is used to know about the present worth and future…

Q: nd the capitalized cost at 15% interest, initial cost $200000, Annual operating cost $4000

A: Below is the given values: Interest rate = 15% Initial cost = $200000 Annual operating cost = $40000…

Q: 5.12 A public water utility is replacing its service trucks with more fuel-efficient vehicles. Two…

A: The annual worth is calculated using the excel function. Formula: PMT(i,n, initial cost, Salvage…

Q: Туре A Туре В Туре С First cost P150,000 P200,000 P250,000 Annual operating cost P30,000 P25,000…

A: As per Rate of Return on Additional Investment Method TYPE A DEPRECIATION = 150000 (A/F, 15%, 10)…

Q: A firm is considering purchasing computers that will reduce annual costs by P40,000. The Computers…

Q: The surface are of a certain plant that requires painting is 8,000 sq. ft. Two kinds of paint are…

A: The Capitalized cost of any structure or property is that the total of its 1st price and therefore…

Q: There are two MEA machines that you are evaluating: Machine A has a lifetime of 6, an initial cost…

A: The maximum value of annual cost for the machine A should make the present worth of machine A equal…

Q: Alternative X has a first cost of 19000 an annual operating cost of 3500, and a salvage value of…

A: Present worth = -P+(AR-Am)( P/A,i%,n)-+F(P/F,i%,n)where, P is the initial cost, AR is the annual…

Q: Dexcon Technologies, Ic., is evaluating two alternatives to produce its new plastic filament with…

A: * SOLUTION :- (7) Given that ,

Q: Dexcon Technologles, Inc., Is evaluating two alternatives to produce its new plastic filament with…

A: Method DDM LS First Cost 140000 480000 M&O 30000 35000 Salvage Value 6000 29000 Life 2 4

Q: 2. Evaluate an electronic fabrication machine on the basis of the annual worth method when the MARR…

A: When a company decides whether a project is worth the costs that will be incurred in undertaking it,…

Q: (engineering economic) The $56000 loan bears interest at 12% annually and must be repaid in uniforrm…

A: Loan interest = $56000 Interest rate annual = 12% Annual installment till = 6th years

Q: there are three machines in the mechanicle angineering lab A ,B , and C and need to be evaluted…

A: Given: Machine A The first cost of = $4,500 An annual operating cost of = $900 Salvage value of =…

Q: A company has requested price offers from two companies for the equipment they will purchase.…

A: We are going to use Present value approach to answer this question.

Q: The annual equivalent of three investment (revenue) alternatives are -23,000 for Investment A-21.000…

A: Answer- Answer is (d) Not invest in any of the alternatives if possible since none generate…

Q: A firm is must choose to buy the GSU-3300 or the UGA- 3000. Both machines make the firm's production…

A: The GSU-3300 produces incremental cash flows of $25,414.00 per year for 8 years and costs…

Q: Project A costs $35,000 initially, has a 4-year life and incurs $4,000 in annual year-end costs.…

A: The equivalent annualcost (EAC) is the yearly expense of purchasing, working, and keeping a resource…

Q: As an engineer, you are responsible to find the best alternative that is economically best. The cash…

A: Since this question consists of multiple parts, we will solve the first two parts for you. If you…

Q: Two processes can be used for producing a polymer that reduces friction loss in engines. Which…

A: Given : Process A : First Cost = 1397151 Annual operating Cost=90383 Salvage Value=80000 Life= 4…

Q: A company that manufactures magnetic membrane switches is investigating two production options that…

Q: Alternative X has a first cost of 34000 an annual operating cost of 6500 , and a salvage value of…

A: Present worth = -P+(AR-Am)( P/A,i%,n)-+F(P/F,i%,n)where, P is the initial cost, AR is the annual…

Q: A school building requires repainting. The surface area to be repainted is 1, 744 sq. mtrs. Two…

A: For paint A to be economical the cost(C) of renewing paint A should be less than the cost(C) of…

Q: For the cash flows shown, determine the incremental cash flow between machines B and A. Machine A В…

A: The net cash flow of every investment consists of an initial cost, next comes the operating cost…

Q: A large textile company is trying to decide which sludge dewatering process it should use ahead of…

A: Given; Centrifuge:- First cost=-300000AOC=-28000Salvage Cost=40000Life= 6 years Belt press:- First…

Q: There are three machines in the mechancical engineering lab A B, and Cand need to be evaluated…

A: Write the formula used for calculation as follows: Present worth = -first cost - Annual cost…

Q: A factory has production capacity of P12,000 units per month with an efficiency of 80%, a fixed…

A: Profit refers to the excess of total revenue gained from the production and selling of good over the…

Q: Compute the annual equivalent repair cost over a 5 year life if a typewriter is warranted for 2…

A: Given: Life=5 years Warranty=2 years Repair cost=$1000 annually i=10%

Q: 10. Evaluate a combined cycle power plant on the basis of the PW method when the MARR is 12% per…

A: MARR=12% Investment cost=$13,000 Annual operation expense=$1000 Please find the images attached for…

Q: A replacement electric motor is being considered for purchased. It is capable of providing 200 hp.…

A: Initial Cost = 3200 Maintenance Cost = 50 Life = 14 Salvage Value = 1452 Motor Used = 400H/year Cost…

Q: Alternate x has first cost of$20000 an operating cost of$9000 per year and $5000salvage value after…

Q: You have been asked to evaluate two alternatives, X and Y, that may increase plant capacity for…

A: Present worth The measure of money today that is identical in worth to an installment, or to a…

Q: Motor A and B is providing 150hp and it is being used for 10 hours per day, 250 days in a year if…

A: Let x be the number of pieces of model A and y be the number of pieces of model B. Let total profit…

Q: Referring to the following cumulative cash flow diagram, salvage value is most nearly ERY $500000…

A: The term "cumulative cash flow" can be applied to both projects and businesses. A company's or…

Q: Marmara Processing Technologies Company wants to buy milling cutters in order to meet its increasing…

A: Current cost of annual operating expense parameter of alternative B will be the present worth of…

Q: rthern Ontario. The default (readily available) option is to connect the site to the regular…

A: The annual worth (AW) an incentive for an option is involved two parts: capital recovery n for the…

Q: It is proposed to place a cable on existing pole line along the shore of a lake to connect two…

A: Given that; By the rate of return on an additional investment method Land route Depreciation…

Q: Complete the following analysis of cost alternatives and select the preferred alternative. The s A B…

A: Answers FW of C = - 13000 * (F/P, 12%,10) - 500 * (F/A, 12%,10) + 1750 = - 13000 * 3.105848 - 500…

Q: -; A company buys equipment for $30000. Annual net savings is 1000 per year for 8 years. The…

A: Answer I attached below

Q: At present, it is op- $504,000. Annual fi- $0.392 per unit of pr а. What is the fir b. At what volun

A: Here, Present capacity is equal to Total revenue Profit = total revenue- total cost All parts…

Q: Calculate the Annual Worth and Cash flow Diagram. DON'T USE EXCEL You bought a new car which you…

A: New Car Purchased = P950,000 Cash Outflow on repair and maintenance: Year 1-5 = P30,000 every six…

Q: Assume you started a sideline business in commercial photography last year using your then-owned…

A: First cost = 160000 Annual expense = 45000 Annual revenue = 75000

Q: Advanced Technologies, Inc. is evaluating two alternatives to produce its new plastic filament with…

A: When the lives of alternatives evaluated are not the same then we have to use either LCM of lives or…

Q: • MARR is 12% per year. Select the more economical vendor bid. Initial cost. S -8,000 -13.000 Annual…

Q: here are three machines in the mechancical engineering lab A, B, and C and need to be evaluated…

A: We are going to calculate Net Present worth to answer this question We are going to use annuity…

Q: A specialty concrete mixer used in construction was purchased for $300,000 7 years ago. Its annual…

A: A business system is structured to link all the complex components and interconnected measures of an…

Q: For a steam power plant the repair costs are estimated to be 1.5$ per short ton coal burned. The…

A: The expenses which are considered to be necessary or reasonably desirable due to vandalism, normal…

Q: An oil company is planning to install a new 80 mm pipeline to connect storage tanks to a processing…

A: Given: Initial cost: RM15,000 annual pump operation hours: 450 hourspump cost per hours: RM2.50…

Question

3. Evaluate the two machines below, using ROR analysis. Which machine should be selected, if MARR is 10%?
Remember, the ROR equation should be set up to ensure equal service.
Mach B
-15,000 -25,000
-400
6,000
Mach A
First cost ($)
AOC ($)
Salvage value (4)
Life (yrs)
-1,600
3,000
6

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

An industrial plant has hired a contractor to develop a solar farm nearby for the industrial plant's electricity consumption. During the 3-year construction period, the contractor will need to run a generator to power the construction. Cost analysis from previous projects indicates: Generator Brand Installed Cost Cost per Hour A $22M $500 B $23M $400 C $25M $250 D $30M $150 At the end of 3 years, the generator will have a salvage value equal to the cost of removing them. The generator will operate 6,000 hours per year. The lowest interest rate at which the contractor is willing to invest money is 7%. (The minimum required interest rate for invested money is called the minimum attractive rate of return, or MARR.) Select the alternative with the least present worth of cost. O Choice "C" with $29,872,900 O Choice "B" with $29,298,320 O Choice C with $28,936,450 O Choice "A" with $29,872,900
A steel manufacturing company at Balakong has operating hours from 7.45am to 5.45 pm. It also includes 15 minutes for 5S activities, lunch break from 12pm-1.15pm, evening break 10mins, morning break 10 mins. The plant is closed every Saturday and Sunday. The production runs three variants of products- A, B and C. i. Determine the takt time to satisfy customer demand of 1800 units monthly of product C
the The fixed costs at Mahi consulting company are $120,000 annually. The annual revenue is $3,000 per client and each client has a $500 variahl cost. Find the breakeven point per year and the annual profit/loss if 408 60 clients have are serviced next year.
Estimate the unit selling price of an item for which the following data is available. Labor 10 hours at $48/hr Overhead 170% of labor Material Costs $64 each Packing Costs 20% of labor Subcontract Cost $13 each 25% of selling price 50% of selling price Sales Commission Profit $5876.00 each $6096.00 each $367.25 each $2612.00 each
Q.(i) . Selling Price :Rs. 12 Per UnitVariable Cost : 2/3 of SPFixed Cost :Rs. 40,000You are required to calculate:(a) Sales to earn profit of Rs. 8000.(b) Also show the BEPs in Breakeven chart. Q.(ii). Use the following information and explain that how the reduction in selling pricewould affect the MOS?Particulars Rs.Selling price per unit 40Material per unit 12Labour per unit. 8Variable Overheads per unit 4Total Fixed cost is Rs. 8, 000. Full capacity of the Plant is 5, 000 units.Reduced selling price is Rs. 32 per unit.
A manufacturing company produced 40,000 boxes of a product that sold for OMR 3 per box. The total variable costs for the 40,000 boxes were OMR 60,000, and the fixed costs were OMR 75,000. (a) How much profit (or loss) resulted? (b) What was the break-even quantity? (c) Assuming that fixed costs remain constant, how many additional boxes will be required for the company to increase profit by OMR 28600.
For th below two machines and based on CC analysis which machine we should select? MARR=10% Machine A Machine B First cost, $ Annual cost, $/year Salvage value, $ Life, years 3 Answer the below question: B- the CC for machine B= 20872 9067 4793 - 123476 infinite 9266
When the TC=TR can you say that your are breakeven or not? Why or why not?
Product X currently sells for $12 per unit. The variable costs is $4 per unit and 10,000 units are sold annually with a profit of $30,000 per year. A new design will increase the variable cost by 21% and fixed cost by 11% but sales will increase to 12777 units per year. At what selling price do the break even occurs for the new design?
If company A manufactures t-shirts and sells them to retailers for US$9.80 each. It has fixed costs of $2625 related to the production of the t-shirts, and the production cost per unit is US$2.30. Company B also manufactures t-shirts and selll them directly to consumers. The demand for its product is p = 15 - (x /25) , its production cost per unit is US$5.00 and its fixed cost are the same as for company A. Revenue function for company A = R(x) = 9.8x Cost function for company A = C(x) = 2625+2.3x Profit function for company A = π(x) = 7.5x -2625 (iv) Using a spreadsheet, create a table for showing x, R(x)?, C(x) for company A in the domain x = 50, 100, 150, 200, 250, 300, 350, 400, 450. (v) Graph the functions from (iv) above on the same axes. (vi) From your graph, determine the break-even level of output for company A
BVM manufactured and sold 25,000 small statues this past year. At that volume, the firm was exactly in a breakeven situation in terms of profitability. BVM’s unit costs are expected to increase by 30% next year. What additional information is needed to determine how much the production volume/sales would have to increase next year to just break even in terms of profitability? (a) Costs per unit (b) Sales price per unit and costs per unit (c) Total fixed costs, sales price per unit, and costs per unit (d) No data is needed, the volume increase is 25, 000 + 25, 000(0.30) = 32, 500 units.
Given EVM data, estimate the cost at completion of a project using the method "EAC based on combined cost and schedule performance." BCWS = $82.2M BCWP = $70.5M ACWP = $95.5M BAC = $105.5M A) $130M B) $150M C) $160M D) $170M