(a)
The resale value of alternative B to provide equal economical transportation.
Answer to Problem 75P
The resale value of alternative B is
Explanation of Solution
Given:
For alternative A:
The initial cost is
The resale value is
The operation cost per kilometer is
For alternative B:
The initial cost is
The operation cost per kilometer is
The distance travelled by car is
The interest rate is
The time period is
Concept used:
Write the expression for economical annual cost.
Here, the initial cost is
Calculations:
Calculate the economical annual cost for alternative A.
Substitute
Calculate the economical annual cost for alternative B.
Substitute
Equate the economical annual cost for alternative A with the economical annual cost for alternative B.
Conclusion:
Thus, the resale value of alternative B is
(b)
The resale value of alternative B to provide equal economical transportation.
Answer to Problem 75P
The resale value of alternative B is
Explanation of Solution
Given:
For alternative A:
The initial cost is
The resale value is
The operation cost per kilometer is
For alternative B:
The initial cost is
The operation cost per kilometer is
The distance travelled by car is
The interest rate is
The time period is
Calculations:
Calculate the economical annual cost for alternative A.
Substitute
Calculate the economical annual cost for alternative B.
Substitute
Equate the economical annual cost for alternative A with the economical annual cost for alternative B.
Conclusion:
Thus, the resale value of alternative B is
(c)
The resale value of alternative B to provide equal economical transportation.
Answer to Problem 75P
The resale value of alternative B is
Explanation of Solution
Given:
For alternative A:
The initial cost is
The resale value is
The operation cost per kilometer is
For alternative B:
The initial cost is
The operation cost per kilometer is
The distance travelled by car is
The interest rate is
The time period is
Calculations:
Calculate the economical annual cost for alternative A.
Substitute
Calculate the economical annual cost for alternative B.
Substitute
Equate the economical annual cost for alternative A with the economical annual cost for alternative B.
Conclusion:
Thus, the resale value of alternative B is
(d)
The resale value of alternative B to provide equal economical transportation.
Answer to Problem 75P
The resale value of alternative B is
Explanation of Solution
Given:
For alternative A:
The initial cost is
The resale value is
The operation cost per kilometer is
For alternative B:
The initial cost is
The operation cost per kilometer is
The distance travelled by car is
The interest rate is
The time period is
Calculations:
Calculate the economical annual cost for alternative A.
Substitute
Calculate the economical annual cost for alternative B.
Substitute
Equate the economical annual cost for alternative A with the economical annual cost for alternative B.
Conclusion:
Thus, the resale value of alternative B is
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Chapter 9 Solutions
ENGR.ECONOMIC ANALYSIS
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