A conveyor system costs $100,000 to install. The Salvage value of the convey or System decreases by $20,000 kach year until its salvage value is at $0, at which point it no longer decrates. The cost to operate andmaintain the convey or system the first year is $20,000; this cost increases by 5% per year. What is theuptimal replacement interval and minimum EUAC for the conveyor systam, assuming a MARR of 12% isUsed? Note that the oppimal replacement interva) is more than (and not equal to) n=13 and less than and (not equal to) n=16 so you do not nerel to seouch for an n outside this range - In fact you will need to onlycheck two values for n based on this range

The optimal replacement interval and minimum EUAC (Equivalent Uniform Annual Cost) Formula:EUAC = P…

Answered: maintain the convey or system the first…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Two lathes are being considered in the manufacture of certain machine parts. Data is given below, all cost in peso: LATHE A LATHE B First Cost 40,000 56,000 Salvage Value 5,000 7,000 Annual Maintenance 2,000 2,800 Operation, Cost/hour 4 3.5 Life, in years 10 12 Time per part (hours) 0.40 0.25 REQUIRED: Determine the number of machine parts/year that could be produced so that 2 lathes will be equally economical if the MARR is 18%. Use AWM If the number of parts is 10,000 units, which lathe will you recommend? Use ROR If the number of parts is 10,000 units, which lathe will you recommend? Use PWM If the number of parts is 10,000 units, which lathe will you recommend? Use EUAC
please shw complete solution
Can you help me understand this problem's soluton? I am getting confused . I dont know which rate to use to convert which one.
Lim Bon Fing Y Hermanos Inc has offered for sale its two-storey building in thecommercial district of Cebu City. The building contains two stores on the ground floor anda number of offices on the second floor.A prospective buyer estimates that if he buys this property, he will hold it for about 10years. He estimates that the average receipts from the rental during this period to beP350,000.00 and the average expenses for all purpose in connection with its ownershipand operation (maintenance and repairs, janitorial services, insurance, etc.) to beP135,000.00. He believes that the property can be sold for a net of P2,000,000 at the endof the 10th year. If the rate of return on this type of investment is 7%, determine thecash price of this property for the buyer to recover his investment with a 7% return beforeincome taxes.ANSWER: P2,526,768.61
The monthly demand for ice cans being manufactured by Alpha Co. is 3,000 pieces. With a manual tool, the unit cutting cost is $25.00. An electrically operated tool was offered at a price of $250k and which will cut by 20% the unit cutting cost. How many months will the Co. be able to recover of the machine if they decide to buy the electrically operated tool now?
A construction machine was bought for $200,000 four years ago. The operating costs were $15,000 per month and revenues $25,000 per month. The machine was just sold for $40,000. Write an AW equation to the calculate the monthly ROR
A man has purchased a new automobile. He wishes to set aside enough money in a bank account to pay the maintenance on the car for the first 5 years. It has been estimated that the maintenance is as follows For year- 1 the maintenance cost =$120, year- 2 the maintenance cost =$150, year- 3 the maintenance cost =$180, year- 4 the maintenance cost =$210, year- 5 the maintenance cost =$240. Assume the maintenance costs occur at the end of each year and that the bank pays 5% interest. How much should the car owner deposit in the bank now? Answer: G = $ A/G = $ ATotal = $ POTotal = $
A $2500 computer system can be leased for $79 per month for 3 years. After 3 years, it can be purchased for $750. This is also the salvage value if the system was purchased originally. What is the effective annual rate for leasing the computer? Ans. i = 1.75% r= 23.10% Show your ful detailed solutions...
The problem A young engineer is considering to built a 1 unit apartment near a commercial center. Because of the location, the investment can guarantee a 90% occupancy rate. So then, he projects an earning of 20% annually. Other data are the following: Land Building cost Projected Useful life Cost of land after 20 years Cost of Building after 20 years Rent/unit/month Maintenance/unit/year Property Taxes Building Insurance P10M 14M 20 years 38M 3.8M 15,000.00 2,200.00 1% 0.7% Is this a good investment? Apply the methods of economic studies.
Show complete solutiion. Do not use excel. Manual Method. Steel drums manufacturer incurs a yearly operating cost of P 200,000. Each drum manufactured cost P 160 and sells for P 300. A machine use for the production has a first cost of P 20,000 and a salvage value of P 2,000 after producing 1,000 units. What is the break even number of units per year?
A contractor has a 4-year concrete mixer whose first cost was $6,000, having 3 more years to live before being scrapped and sold at $801. Itcould now be sold for $11,922. It has an annual cost for operation and maintenance of $9,352. Its replacement is being proposed with a newmachine whose first cost will be $8,000 having a life of 9 years and salvage value $1,600. It has an operating cost of $800 per year andmaintenance cost of $320 per year. Ifthe interest is 20% cpd-a, what is the Annual Equivalent Cost of the Old Machine? 14,792
Ramsis is a heavy equipment rental company. It is considering the purchase of Tower crane at a price of BD 775,000. This crane is expected to operate for 12 years before retirement with no salvage value at the end. The company is planning to rent the crane for BD 108.000 per year starting year 2 and the rental inereases by 10% thereafter. Cost of this maintenance is expected to be BD 15,000 cach year. a) What is the discounted payback period, if the MARR is 8% per year? b) In your engineering analysis study, which method would you select (Payback or Preseut worth) to solhve this problem? And why?

SEE MORE QUESTIONS

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Managerial Economics: A Problem Solving Approach

Economics

ISBN:

9781337106665

Author:

Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:

Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-…

Economics

ISBN:

9781259290619

Author:

Michael Baye, Jeff Prince

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS