# HW-Chap-6-2 - Engineering Economy GE 272 Chapter 6 6-32...

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Engineering Economy GE 272 Chapter 6 6-32 EUAC Comparison Gravity Plan Initial Investment: = \$2.8 million (A/P, 10%, 40) = \$2.8 million (0.1023) = \$286,400 Annual Operation and maintenance = \$10,000 Annual Cost = \$296,400 Pumping Plan Initial Investment: = \$1.4 million (A/P, 10%, 20) = \$1.4 million (0.1023) = \$143,200 Additional investment in 10th year: = \$200,000 (P/F, 10%, 10) (A/P, 10%, 40)= \$200,000 (0.3855) (0.1023) = \$7,890 Annual Operation and maintenance = \$25,000 Power Cost: = \$50,000 for 40 years = \$50,000 Additional Power Cost in last 30 years: = \$50,000 (F/A, 10%, 30) (A/F, 10%, 40) = \$50,000 (164.494) (0.00226) = \$18,590 Annual Cost = \$244,680 Select the Pumping Plan. 6-36 (a) A = \$9,000 (A/P, 1%, 24) = \$9,000 (0.0471) = \$423.90/month (b) Note that interest is compounded quarterly A’ = \$9,000 (A/F, 1.5%, 8) = \$9,000 (0.1186) = \$1,067.40 Monthly Deposit = ½ of A’ = (\$1,067.40)/3 = \$355.80/month (c) In part (a) Bill Anderson’s monthly payment includes an interest payment on the loan. The
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