PS 14 - Replacement Analysis without Taxes Same UL

# PS 14 - Replacement Analysis without Taxes Same UL - c What...

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IE 150 Problem Set 14 Replacement Analysis without Taxes (Same UL)  Instructions:  Write/Type/Print your answers on yellow pad or bond paper (NO A4’s). Use a different sheet per  problem.  Use phrases  to describe what you are doing. Do not present it as just a series of equations and  numbers.  Label each step. Ex: “Step 1: Set-up the Total Revenue Equation”, “Step 4: Solve for the NPV”.  Box the final answers.  Use clear formatting: Indent at each step. Show your answers in just 1 column. (The problem set  will be read from top to bottom, and not top bottom diagonal right bottom.) Problem 1:  a) Define the EUAC.  b) What is its significance in replacement analysis?

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Unformatted text preview: c) What is the condition that must be satisfied so that the defender will not be replaced by the challenger? Problem 2: The replacement of asset A is currently being evaluated. The details of Assets A and B are summarized below: Asset A EOY Market Value Annual Exp. 5,000 1 4,000 5,500 2 3,000 6,500 3 2,000 7,000 4 1,000 8,900 Asset B EOY Market Value Annual Exp. 20,000 1 15,000 2,000 2 11,000 3,000 3 8,000 5,000 4 6,000 6,000 When would it be most beneficial to replace asset A? (Show tables for Asset A and B). IE 150 Problem Set 14 Replacement Analysis without Taxes (Same UL)...
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## This note was uploaded on 09/23/2011 for the course IE 151 taught by Professor J3patino during the Spring '11 term at University of the Philippines Diliman.

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PS 14 - Replacement Analysis without Taxes Same UL - c What...

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