CEE270 homework 7 S19 (soln).pdf - CEE 270 Systems Analysis...

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1 CEE 270 Systems Analysis & Economics for Civil Engineers Spring 2019 Homework #7 Solution Key Note: There are usually multiple ways to solve a problem. The solution key provides one of a few. 1. (25 points) How much money was deposited each year for 5 years if the account is now worth $100,000 and the last deposit was made 10 years ago? Assume the account earned interest at 7% per year.
2 2. Two equal deposits made 20 and 21 years ago, respectively, will allow a retiree to withdraw $10,000 now and $10,000 per year for 14 more years. If the account earned interest at 10% per year, how large was each deposit?
3 3. Two methods can be used for producing expansion anchors. Method A costs $80,000 initially and will have a $15,000 salvage value after 3 years. The operating cost with this method will be $30,000 per year. Method B will have a first cost of $120,000, and operating cost of $8000 per year, and a $40,000 salvage value after its 3-year life. At an interest rate of 12% per year, which method should be used on the basis of a present worth analysis?
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