Suggested problems_Chp 9_sol

# Suggested problems_Chp 9_sol - Suggested problems for...

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Suggested problems for Chapter 9 – Solutions 1. (9.1) The investment value of the old lift truck is its current market value. Defender: PW(20%) = \$7,000 \$8,000(P/A, 20%, 5) = \$30,925 Challenger: PW(20%) = \$22,000 \$5,100(P/A, 20%, 5) + \$9,000(P/F, 20%, 5) = \$33,635 Keep the old lift truck (PW Defender > PW Challenger ). 2. (9.6) Cost of EOY MV Loss in MV capital Expenses TC PW A/P EUAC 0 80,000 1 60,000 20,000 12,000 30,000 62,000 53,913 1.1500 \$62,000 2 50,000 10,000 9,000 30,000 49,000 37,051 0.6151 \$55,952 3 40,000 10,000 7,500 35,000 52,500 34,520 0.4380 \$54,962 4 25,000 15,000 6,000 40,000 61,000 34,877 0.3503 \$56,174 5 12,500 12,500 3,750 45,000 61,250 30,452 0.2983 \$56,919 Best time to replace is after 3 years . 3. (9.7) Challenger Year Market Value Loss in Value Cost of Capital O&M Marginal Cost EUAC 0 \$42,500.00 −− −− −− −− −− 1 \$31,000.00 \$11,500.00 \$6,375.00 \$10,000.00 \$27,875.00 \$27,875.00 2 \$25,000.00 \$6,000.00 \$4,650.00 \$12,500.00 \$23,150.00

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## This note was uploaded on 02/07/2012 for the course IE 343 taught by Professor Vincent,g during the Spring '08 term at Purdue University-West Lafayette.

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Suggested problems_Chp 9_sol - Suggested problems for...

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