HW-Chap-5-1 - security considerations 5-37 Since the...

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Engineering Economy ENGR 300 Chapter 5 5-1 P = $50 (P/A, 10%, 4) + $50 (P/G, 10%, 4) = $50 (3.170) + $50 (4.378) = $377.40 5-4 Q = $50 (P/A, 12%, 6) (F/P, 12%, 2) = $50 (4.111) (1.254) = $257.76 5-26 (a) PW Costs = $700,000,000 + $10,000,000 (P/A, 9%, 80) = $811,000,000 PW Receipts = ($550,000) (90) (P/A, 9%, 10) + ($50,000) (90) (P/G, 9%, 10) + ($1,000,000) (90) (P/A, 9%, 70) (P/F, 9%, 10) = $849,000,000 NPW = $849,000,000 - $811,000,000 = $38,000,000 This project meets the 9% minimum rate of return as NPW is positive. (b) Other considerations: Engineering feasibility, Ability to finance the project, Effect on trade with Brazil, Military/national
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Unformatted text preview: security considerations 5-37 Since the necessary waste treatment and mercury recovery is classed as Fixed Output, choose the alternative with the least Present Worth of Cost. Foxhill PW of Cost = $35,000 + ($8,000 $2,000) (P/A, 7%, 20) $20,000 (P/F, 7%, 20) = $35,000 + $6,000 (10.594) $20,000 (0.2584) = $93,396 Quicksilver PW of Cost = $40,000 + ($7,000 $2,200) (P/A, 7%, 20) = $40,000 + $4,800 (10.594) = $90,851 Almeden PW of Cost = $100,000 + ($2,000 $3,500) (P/A, 7%, 20) = $100,000 $1,500 (10.594) = $84,109 Select the Almaden bid....
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This note was uploaded on 04/18/2011 for the course ENGINEER 300 taught by Professor Kashayar during the Spring '11 term at California State University Los Angeles .

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