Alternative Choice Examples (Chap 5 and 11)

Alternative Choice Examples (Chap 5 and 11) - useful life...

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CE 395 Engineering Economics Choosing Between Alternatives Problem Examples General. The following problems should be useful in your study of Engineering Economics method applications. Most of the examples are past Exam problems. Example 8 is the solution to problem 5 – 33 of the text. It should be useful background to help you solve problem 5 – 32. 1. A firm is considering three mutually exclusive alternatives as part of a production improvement program. For each alternative the salvage value at the end of the
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Unformatted text preview: useful life is zero. At the end of 10 years option A may be replaced with another A with identical cost and benefits. The minimum attractive rate of return is 6%. Use the Present Worth Method to determine which alternative should be selected. 2. 3. 4. Choose between the four mutually exclusive alternatives below. First solve using the Future Worth Method and second solve using the Benefit/Cost ratio method. 5. 6. 6. 7. 8. Problem 5 -33 from the Text...
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Alternative Choice Examples (Chap 5 and 11) - useful life...

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