A renewable energy industry is one of the promising sectors in future and play a major role in the vision 2030. If a specialized company in energy planning to upgrade their equipment now to meet future demand at cost of $200.000 or they purchase the upgrade package three years from now at cost of $300,000. Assume that the minimum attractive rate of return is 12% per year and the inflation is 3% per year. If the company decided to purchase the upgrade 3 years from now without considering inflation what will be the cost?

Q: BA company invest Php 100,000 today to be repaid in 5 years in one lump sum at 12 % compounded…

A: Given, PV=present value =10000i=real interest raten=5 years

Q: If the inflation rate is higher than the interest rate, then   A. it is no longer possible to earn…

A: According to the Fisher equation, Real interest rate = Nominal interest rate - inflation rate…

Q: Using the mid-point formula calculate the price elasticity of demand for petrol and Hyundai 7.5kW…

A: The degree with which the consumers change their demand or producers change their supply when the…

Q: A self-employed chemical engineer is on contract with Dow Chemical, currently working in a…

A: The above question has been solved below.Rate of interest (i) = 15%Rate of inflation (f) =…

Q: What is the uninflated present worth of a P 200,000 future value in two years if the average…

A: Market interest rate (IM) can be calculated by using the following formula.

Q: An annuity pays $1100 per year for 13 years Inflation is 6 percent per year a. If the real MARR is 8…

A: Given, Real MARR=8%  Inflation=6%

Q: Jennifer will retire in 16 years from now. On that occasion, her company will give her a one-time…

A: Suppose original price level is 100. if the inflation rate is 2.5% per year, then the price level…

Q: Because retail supermarket corporations operate on a low ROR, it is common to use a market MARR of…

A: The inflation rate formula can be calculated as follows:

Q: find the present worth of 1000 today (2021) in the year 1990 if the inflation rate of 12% is…

A: Given  Rate of inflation i =12 which is constant through years Future value (2021) FV =1000 We have…

Q: A top-of-the-line 3D printer costs $40,000 today. The manufacturer plans to raise the price so that…

A: The cost of the machine (CM) is $40,000. Rate of return (i) is 5%, inflation is 4%. Then the time…

Q: Initial project set-up costs are estimated to be SEK15m (year 0 - 2023). Further estimated operating…

A: Taking into consideration the increase in costs at their respective rates we get - YEAR  OC…

Q: You would like to buy a house that is currently on the market at $85,000, but you cannot afford it…

A: Present value (PV) = $85000 Total time period for which the expected price is found= 4 years…

Q: An automobile that cost $24,500 in 2018 had an equivalent model 4 years later that cost $29,250. If…

A: Given that,   P = 24,500 F = 29,250 t = 4 years

Q: Generally speaking, hyperinflation is an annual rate of inflation above 25% 50% 0% 100%

A: Inflation refers to the increase in the general level of prices of goods and services in the…

Q: Factors that increase costs and prices—especially for materials and manufacturing costs sensitive to…

A:

Q: he inflation rate is higher than the interest rate, then a. it is no longer possible to earn any…

A: In economics, inflation is defined as an increase in the price of goods and services across a…

Q: When all future cash flows are expressed in constant-value dollars, the rate that should be used to…

A: The usage MAAR, inflation rate or real interest rate to convert the future cash flow that is…

Q: How can the conversion be done from Constant to Actual Dollars?

A: The constant value of a currency is the nominal value that has been adjusted for the changes in…

Q: A very generous grandfather is planning to leave his only granddaughter well off when she reaches…

A: Inflation adjusted interest rate is calculated as: if=i+f+i(f) Where: i: real interest rate f:…

Q: quatech Microsystems spent $185,000 for a communications protocol to achieve interoperability among…

A: Aquatech Microsystems spent $185,000 on a communications protocol  the real interest rate of 15%…

Q: Maintenance costs for pollution control equipment on a pulverized coal cyclone furnace are expected…

A: The cost of a product applies to the expenses paid by a corporation to manufacture a product or to…

Q: A small mechanical consulting company is examining its future cash flow requirements. The president…

A: The formula for calculating purchasing power is given below: Future value = Present value(1+rate of…

Q: Colgate-Palmolive can purchase a piece of equipment now for $80,000 or buy it 3 years from now for…

A: The market interest rate can be calculated as follows: i=0.15+0.049++0.150.04=0.19+0.006=0.196 Thus,…

Q: A recently graduated mechanical engineer wants to build a reserve fund as a safety net to pay his…

A: Real interest rate can be calculated as follow:

Q: α-β, Inc., a high-tech company in San Diego, whose stock trades on the NYSE exchange, uses a MARR of…

A: According to the Fisher equation  (1+ R) = (1 + i) (1+ d) R - Nominal interest rate = 0.25 i - Real…

Q: An asset costs $10,000 today. If inflation is 4% per year and interest is 12% per year, what will be…

A: In economics, present value refers to the current value of a future stream of cash flow. Future…

Q: A man decided to deposit a certain amount of money on his son's 10th birthday, which will be…

A: FV = 280,000 Bank pay interest rate = 5.5% Rate of inflation = 8.7% n = (25 - 10) = 15 Year Note:-…

Q: You would like to buy a house that is currently on the market at $85,000, but you cannot afford it…

A: The market price of house = $85000 Inflation rate = 6% Time duration = 4 years

Q: In wisely planning for your retirement, you invest $18,000 per year for 20 years into a 401K…

A: * SOLUTION :-  * (10)

Q: A man deposits P50.000 in a bank account at 6% compounded monthly for 5 years. If the inflation rate…

A: Inflation refers to the increasing price level in the economy during a period of time. Interest rate…

Q: A hundred thousand pesos now will become P341,655.49 in eight years at an interest rate of 10%…

A: Present value = P100,000 Future value or value after 8 years = P341655.49 Interest rate = 10% Time =…

Q: The cost of 1,000 cubic feet of natural gas has increased from $6 in 2000 to $15 in 2006. What…

A: The provided information are: Present value (PV) = $6 Future value (FV) = $15 Number of periods (n)…

Q: Is it necessary to account for inflation in an engineering economy study? What are the two…

A: Engineering Economy study involves application of economic principles in the analysis of engineering…

Q: You would like to buy carcar t is currently on the market at $85,000, but you cannot afford it right…

A:

Q: The future amount of $500,000 for a period of 8 years is equal to $400,000, considering money is…

A: Given Present value = 500000 Future value = 400000 Time = 8 years Interest rate = 8 % per year…

Q: A diamond ring will be worth P35,000 in 2023. How much was it when it was bought in 2019 if the…

A: here we calculate the present worth of ring in 2019 which are as follow-

Q: A self-employed chemical engineer is on contract with Dow Chemical, currently working in a…

A: The above question has been solved below. Rate of interest (i) = 15% Rate of inflation (f) = 11%…

Q: If P10k is lend today at 12% compounded annually is to be repaid in one lump sum at the end of 5…

A: A real rate of interest is associate rate of interest that has been adjusted to get rid of the…

Q: The Bureau of Labor Statistics has a website (www.bls.gov) that contains a Consumer Price Index…

A: Purchasing power in 1913 = $2.5 million Purchasing power in 2016= $23930909 Number of years = 103…

Q: A software company’s labor requirements currently cost $350,000/year. The labor hour requirements…

A: a. The given details indicate that the company needs a labor supply cost of $350,000 per annum and…

Q: The cost of constructing a roundabout (R/A) in a low-traffic residential neighborhood 5 years ago…

A: Given:

Q: If a 3D printer increased in cost at exactly the inflation rate, what was the inflation rate if the…

A: Cost is increase equal to the inflation rate. The cost doubled in 10 years. If the cost (PC) is $10…

Q: The average cost of a gallon of gas was $0.80 per gallon in 1995. In 2011, theaverage cost of a…

A: Answer - Given in the question - Average cost of gallon of gas in 1995 (CPI0)= $0.80   Average cost…

Q: The cost of a wastewater treatment plant for a small town of 6000 people was estimated to be about…

A: Given,   Number of people = 6000  Cost of treatment per person = $85  Inflation rate = 2.5%  Number…

Q: The maintenance cost of a vacuum is P200 this year, if the expected increas the maintenance cost of…

A: we have, Maintain cost of vacuume = P200 Increment every year = P100 Time 8 years Interest rate = 8%

Q: An investment of $100,000 in safe 10-year corporate bonds yields an average of 9% per year, payable…

A:

Q: A bicycle tire company performed a web-based study of a popular tire retail price over time. The…

A: it is given that, the retail price is increased from $16 per tire to $19 per tire. the time period…