Solutions to Homework _8

Solutions to Homework _8 - Solutions to HW #8 (Chapter 9)...

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Solutions to HW #8 (Chapter 9) IE 1040 Fall, 2005 9-5 EOY Market Value Loss in Value Cost of Capital Annual Expenses Total Cost EUAC(12%) 1 $2,250 $750 $360 $ 950 $2,060 $2,060 2 1,800 450 270 1,050 1,770 1,923 3 1,450 350 216 1,100 1,666 1,847 * 4 1,160 290 174 1,550 2,014 1,882 * Economic life = 3 years . 9-9 The repeatability assumption and the AW method (over one useful life cycle) are used in the comparison of the two robots. The use of repeatability as a simplified modeling approach can be supported in this case. The estimated annual expenses for the defender are a geometric cash flow sequence (Chapter 4). The negative estimated market value (-$1,500) indicates an expected net cost for the disposal of the asset at the end of six years. 383 , 15 $ ) 6 %, 25 , P / A ( 08 . 0 25 . 0 )] 6 %, 8 , P / F )( 6 %, 25 , F / P ( 1 [ 400 , 1 $ ) 6 %, 25 , P / A )( 000 , 2 $ 200 , 38 ($ %) 25 ( AW D - = - - - + - = and, for the challenger, the AW over its useful life is 035 , 17 $ ) 10 %, 25 , / ( 000
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Solutions to Homework _8 - Solutions to HW #8 (Chapter 9)...

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