1. Recognize problem:
3 possible events that might signal the need for a new car is
1) When maintenance cost start to exceed original car price
2) When the car has bad mileage compared to other new cars
3) When the lease on my old car is up
2. Define the
It is expected that an investment of P at time 0 to provide an income of $1,000 every year for the next 12 years. If
the investor expects to have a rate of return of 9% per year, what is the value of P?
$8,921.00
$7,161.00
$9,322.00
$4,266.00
A machine at
Homework #11
05/03/2012
ISYE 313 Engineering Economic Analysis HW#11
Members:
Kristen Bond
Lucas Bunzel
Jason Choe
Tyler Filzen
Peter Gumulia
Contribution:
20%
20%
20%
20%
20%
Summary of Answers
Problem 15-4
A) WACCbefore-taxes = 10.52%
B) WACCafter-taxes
q6
Question 1
0 / 1 point
From the data available below, find the best alternative using the payback period analysis.
Year
A
0
B
C
-$500 -$2,000 -$1,200
1
$200
$400
$1,000
2
$100
$50
$0
3
$400
$1,000
$100
4
$50
$2,000
A)
Alt. A
B)
Alt. B
View Feedback
Que
15.50
MARR
Department
X
Y
Z
Buying Cost
Rising cost/yr
Overall Buying Cost
Make
Equipment Cost
Salvage Value
n
Direct Costs
Overall Making Costs
Basis
Rate
Direct Labor Cost
Materials Cost
Number of inspection
-3,900,000
-300,000
-4,551,614 (in AW)
-3,000
4.31
n (years)
Cost/gallon ($/gallon)
No. of gallon/ month
Nominal Interest
Effective Interest
Cost/month
Capital cost/ month
20
0.00085
200,000,000
6%
0.5%
170000
$23,642.22
Total cost/month
$193,642.22
4.46
n
Period
Nominal Interest
Effective Interest
I
Maggie Hannigan
ISYE 313
Homework 4
6.10
Jacobson Recovery recovered his investment because his Capital Recovery was $-47,590
per year and his revenue was $52,000. The annual worth was negative and totaled -$9,175
at 12% per year.
6.14
At an interest rate
Maggie Hannigan
Homework 9
15.50, 15.52, 16.23, 16.29, 16A.8
15.50
After completing an AW analysis, you should select the make alternative. The annual
worth for make was $-3763075 and the annual worth for buy was $-4551600.
15.52
Materials
Texas
Oklahoma
Maggie Hannigan
9.19
The conventional B/C ratio for the Parks and Recreation Department of Burkett
County is 1.16. The modified B/C ratio is then 1.30.
9.35
Using the B/C method, an interest rate of 7% per year, and a 20 year period, method
2 is more attr
Maggie Hannigan
ISyE 313
09/14/2016
1.5
1. II.2. A
a. Engineers shall undertake assignments only when qualified by education
or experience in the specific technical fields involved
b. Neither she nor any of her team members have done such a significant
de
4.16
If the person accepts the offer from In N Out, the nominal interest rate per year will
be 60% and the effective rate per year will be 79.59%.
4.31
If the army base uses 200 million gallons of water per month, the Armys cost per
month for water is $19
Maggie Hannigan
ISYE 313
Homework 5
8.11
The incremental cash flows for the LCM of 4 years were tabulated. This resulted in $196,400 for Machine X, -$159,600 for Machine Y, and $36,800 for Machine YMachine X.
8.25
Using an AW-based rate of return analysis
13.10
Cost of gasoline
Old
New
Interest rate
Miles/gallon
18
21 No. of periods
Cost/ mile
0.1805555556 0.1547619
$ saved/ mile
0.0257936508
Cost of upgrade
800
No. of miles/month 1030.1545935801
PV of $ saved
800
3.25
1%
36
13.22
Painting
Painting Cost
n
Tanapat R. ISyE 313 10/29/2016
Homework 6 Summary
*All workings shown on excel
9.19
For this question, I decided to use annual worth for the B/C analysis because most of the
numbers are already in AW. I converted the first cost to AW using the PMT functio
Tanapat Ratanaruengjumrune ISyE313 09/23/2016
Summary
2.8.
The company can afford to spend ~$47663 now given an interest rate of 12% and a future
value of $75,000. For this question, I took F and multiplied it with the P/F factor with i=12%
and n=4 to get
Tanapat Ratanaruengjumrune ISyE 313 11/18/2016
Homework 10 Summary
15.50
To solve this problem, we must compare the cost of buying in AW to the cost of making in
AW. For the buying cost, I generated the cash flows for the whole 6 years, adding 300,000 to
Tanapat Ratanaruengjumrune ISyE 313 09/30/2016
Summary
*Workings shown in the excel file attached
4.16
a. Since 10 is 5 percent of 200, it means that the interest rate per month is 5%. That means
that the nominal interest rate per year is (5)(12)=60%, whi
Tanapat Ratanaruengjumrune ISyE 313 10/07/2016
Summary
*All workings are shown in Excel
6.10
a) For this question, it asks for the capital recovery. Capital recovery is basically the
equivalent amount of revenue a system much earn each year to cover the i
Tanapat R. ISyE 313 12/9/2016
Homework 10 Summary
*All workings done on Excel
17.27
For a), I generated columns for taxable income and taxes of each method. To do that, I first
did a table for depreciation for each method in each year. Then I subtracted t
Tanapat Ratanaruengjumrune ISyE 313 10/04/2016
Homework 7 Summary
*All workings shown in Excel
11.14
For this question, the AW for each year from 1 to 6 must be found. I first converted the first
cost and salvage value to the annual cost from year 1 to ye
11.14
n
First Cost
Operating Cost
i
-70,000
-75,000
12%
n
AW
1
2
3
4
5
6
ESL 6 years
AW = -$88,772.58
(93,900.00)
(92,562.74)
(91,404.76)
(90,400.89)
(89,529.63)
(88,772.58)
First cost (in AW)
1
(78,400.00)
2
(41,418.87)
3
(29,144.43)
4
(23,046.41)
5
(19,
Tanapat R. ISyE 313
Homework 11 Summary
18.9
First of all, I generated a cash flow table for Continuous for 5 years. Then, I used the NPV
function to generate the present worth of the cash flows at an interest rate of 15%. Using
this PV value, I used the
Tanapat Ratanaruengjumrune ISyE 313 11/11/2016
Homework 8 Summary
* all workings shown in excel
13.10
In order to find the breakeven quantity of miles, we must first find the revenue. I will call
the amount of money saved from upgrading the revenue per un