ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
expand_more
expand_more
format_list_bulleted
Question
Chapter 6, Problem 36P
To determine
To recommend: the option to be chosen using annual worth comparison.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Q3 solution needed. another pic is just for helping material
←
An oil refinery finds that it is necessary to treat the waste liquids from a new process before discharging them into a stream. The treatment will cost $40,000 the first year, but
process improvements will allow the costs to decline by $4,000 each year. As an alternative, an outside company will process the wastes for the fixed price of $20,000/year
throughout the 8 year period, payable at the beginning of each year. Either way, there is no need to treat the wastes after 8 years. Use the annual worth method to determine
how the wastes should be processed. The company's MARR is 13%.
Click the icon to view the interest and annuity table for discrete compounding when the MARR is 13% per year.
www
A road can be paved with either asphalt or concrete. Concrete costs $20,000/mile and lasts for 20 years. What is the maximum that should be spent on asphalt, which lasts only 10 years? The annual maintenance costs are $500/mile for both pavements. The cost of money = 8%.
Chapter 6 Solutions
ENGR.ECONOMIC ANALYSIS
Ch. 6 - Prob. 1QTCCh. 6 - Prob. 2QTCCh. 6 - Prob. 3QTCCh. 6 - Prob. 4QTCCh. 6 - Prob. 5QTCCh. 6 - Prob. 1PCh. 6 - Prob. 2PCh. 6 - Prob. 3PCh. 6 - Prob. 4PCh. 6 - Prob. 5P
Ch. 6 - Prob. 6PCh. 6 - Prob. 7PCh. 6 - Prob. 8PCh. 6 - Prob. 9PCh. 6 - Prob. 10PCh. 6 - Prob. 11PCh. 6 - Prob. 12PCh. 6 - Prob. 13PCh. 6 - Prob. 14PCh. 6 - Prob. 15PCh. 6 - Prob. 16PCh. 6 - Prob. 17PCh. 6 - Prob. 18PCh. 6 - Prob. 19PCh. 6 - Prob. 20PCh. 6 - Prob. 21PCh. 6 - Prob. 22PCh. 6 - Prob. 23PCh. 6 - Prob. 24PCh. 6 - Prob. 25PCh. 6 - Prob. 26PCh. 6 - Prob. 27PCh. 6 - Prob. 28PCh. 6 - Prob. 29PCh. 6 - Prob. 30PCh. 6 - Prob. 31PCh. 6 - Prob. 32PCh. 6 - Prob. 33PCh. 6 - Prob. 34PCh. 6 - Prob. 35PCh. 6 - Prob. 36PCh. 6 - Prob. 37PCh. 6 - Prob. 38PCh. 6 - Prob. 39PCh. 6 - Prob. 40PCh. 6 - Prob. 41PCh. 6 - Prob. 42PCh. 6 - Prob. 43PCh. 6 - Prob. 44PCh. 6 - Prob. 45PCh. 6 - Prob. 46PCh. 6 - Prob. 47PCh. 6 - Prob. 48PCh. 6 - Prob. 49PCh. 6 - Prob. 50PCh. 6 - Prob. 51PCh. 6 - Prob. 52PCh. 6 - Prob. 53PCh. 6 - Prob. 54PCh. 6 - Prob. 55PCh. 6 - Prob. 56PCh. 6 - Prob. 57PCh. 6 - Prob. 58PCh. 6 - Prob. 59PCh. 6 - Prob. 60PCh. 6 - Prob. 61PCh. 6 - Prob. 62PCh. 6 - Prob. 63PCh. 6 - Prob. 64PCh. 6 - Prob. 65PCh. 6 - Prob. 66PCh. 6 - Prob. 67PCh. 6 - Prob. 68PCh. 6 - Prob. 69PCh. 6 - Prob. 70PCh. 6 - Prob. 71PCh. 6 - Prob. 72PCh. 6 - Prob. 73PCh. 6 - Prob. 74PCh. 6 - Prob. 75PCh. 6 - Prob. 76PCh. 6 - Prob. 77P
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
- At age 30 you invest P5,500 into a mutual fund. If the fund averages an 7% annual return, your investment is worth how much at age 55?arrow_forwardA firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firm’s production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $24,998.00 per year for 8 years and costs $99,590.00. The UGA-3000 produces incremental cash flows of $29,475.00 per year for 9 years and cost $126,038.00. The firm’s WACC is 8.32%. What is the equivalent annual annuity of the GSU-3300? Assume that there are no taxes.arrow_forwardThe Ford Motor Company has re-designed its best selling truck by substituting aluminum for steel in many key body parts. This saves 600 pounds of weight and decreases gas consumption. The fuel consumption will be 27 miles per gallon (mpg), up from 24 mpg of the previous year's model. Ford will increase the sticker price of the re-designed vehicle by $470. Assume this vehicle will be driven 16,000 miles per year and its life will be 9 years. The owner's MARR is 8% per year and gasoline costs $3.02 per gallon. What is the present worth of the incremental capital outlay for the lighter truck? Click the icon to view the interest and annuity table for discrete compounding when the MARR is 8% per year. The present worth of the incremental capital outlay for the lighter truck is $ (Round to the nearest dollar.)arrow_forward
- Army Research Laboratory scientists developed a diffusion-enhanced adhesion process which is expected to significantly improve the performance of multifunction hybrid composites. NASA engineers estimate that composites made using the new process will result in savings in space exploration projects. The cash flows for one project are estimated. Determine the rate of return per year. Year, t Cost ($1000) Savings ($1000) 0 −210 — 1 −150 — 2–5 — 100 + 60(t − 2)arrow_forwardA diesel engine uses type A filter and high end lubricating oil costing $5.50 per liter. With this filter the oil and filter have to be change every 500 hours of operation, and 5 liters of oil have to be added every 100 hours. This filter costs $148 per piece. 80 liters of oil fill the engine. Another type, Filter B, costing $120 may be used with a lower grade of oil costing $4.80 per liter. However if this filter is used, the oil and the filter had to be change every 300 hrs and 10 liters are added after each 150 hrs the engine is used. Which type of filter would you recommend?arrow_forwardA diesel engine uses a Type A filter and high-grade lubricating oil costing $5.50 per liter. With this filter, the oil and filter have to be changed every 500 hours of operation, and 5 liters of oil have to be added every 100 hours. This filter cost $148 a piece.Eighty liters of oil fill the engine. Another type, filter B, costing $120 may be used with a lower grade oil costing $4.80 per liter. However, if this filter is used, the oil andfilter have to be changed every 300 hours, and 10 liters are added after every 150 hours the engine is used. Which type of filter and oil would you recommend? Kindly show your complete solutions. Thank youarrow_forward
- Wall’s Pharmacy will have to sell a new product that has an estimated revenue of $5,100 per month and costs of $1,000 per month with an initial purchase of $28,000. How long will Wall's Pharmacy have to sell a new product if the MARR is 3% per month? Wall's Pharmacy will have to sell a new product for __ months.arrow_forwardPractice Problem Irene just purchased a new sports car and wants to also set aside cash for future maintenance expenses. The car has a bumper-to-bumper warranty for the first five years. Irene estimates that she will need approximately $2,000 per year in maintenance expenses for years 6-10, at which time she will sell the vehicle. How much money should Irene deposit into an account today, at 8% per year, so that she will have sufficient funds in that account to cover her projected maintenance expenses?arrow_forwardEconomical solar energy and energy from fusion have been identified as two of engineering's grand challenges. While work continues on these grand challenges, conservation of energy from non-renewable sources is vital. On a practical level, installing low thermal emissivity windows (low-e windows) on buildings can contribute to energy conservation. Installing low-e windows on a small office building is estimated to cost $10,500. The windows are expected to last 9 years and have no salvage value at that time. The energy savings from the windows are expected to be $2,525 in the 1st year. After the 1st year, the savings are expected to increase by $200 each year due to escalating fossil fuel costs. MARR is 12% per year and annual worth is the preferred measure of economic worth. Part a Are the low-e windows an economically attractive investment? Click here to access the TVM Factor Table Calculator. The annual worth of installing the low-e windows is $ Carry all interim calculations to 5…arrow_forward
- A large textile company is trying to decide among three alternatives of sludge dewatering g, processes. The costs associated with these alternatives are shown below. Alternative Y will need an upgrade of $9700 at the end of year 2. At the end of year 2, alternative Z would be replaced with another alternative Z having the same installed and operating costs. If the MARR is 14% per year, which alternative should be chosen? \table[[Alternative,x,Y,Z 6) A large textile company is trying to decide among three alternatives of sludge dewatering processes. The costs associated with these alternatives are shown below. Alternative Y will need an upgrade of $9700 at the end of year 2. At the end of year 2, alternative Z would be replaced with another alternative Z having the same installed and operating costs. If the MARR is 14% per year, which alternative should be chosen? Alternative X Y Z Installed costs $68,500 $48,500 $33,500 Annual operating costs. $6000 $4000 $5000 Overhaul cost in year 2…arrow_forwardThe surface are of a certain plant that requires painting is 8,000 sq. ft. Two kinds of paint are available whose brands are A and B. Paint A costs P1.40 per sq. ft. but needs renewal at the end of every 4 years, while paint B costs P1.80 per sq. ft. If money is worth 12% effective, how often should paint B be renewed so that it will be as economical as Paint A?arrow_forwardAn investor has invested $250,000 in a new rental property. Her estimated annual costs are $6000 and annual revenues are $20,000. What rate of return per year will the investor make over a 30-year period ignoring the salvage value? If the property can be sold for $200,000 what is the rate of return?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSONEngineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
- Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage LearningManagerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningManagerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education
Difference between Renewable and Nonrenewable Resources; Author: MooMooMath and Science;https://www.youtube.com/watch?v=PLBK1ux5b7U;License: Standard Youtube License