Situation4: Calculate the benefit cost ratio for a highway project with the following benefits and costs, The project life is 40 years, the interest rate is 10%, and the project's right of way is worth $5M in 40 years. $20M-----Construction Cost (includes acquiring right of way) $350K----Annual maintenance -------Repaving every 8 years. $1M------Annual value of lives saved (1 per year) $1.25M---Time savings for commercial traffic $20 0.25 hours 250,000 trips $3M-- hour trip year $1M------Time savings for commuter and recreational traffic/year $5 0.25 hours 800,000 trips hour Hint: Benefit cost ratio = trip year Annual benefit costs/ Total cost

Situation4: Calculate the benefit cost ratio for a highway project with the following benefits and costs, The project life is 40 years, the interest rate is 10%, and the project's right of way is worth $5M in 40 years. $20M-----Construction Cost (includes acquiring right of way) $350K----Annual maintenance -------Repaving every 8 years. $1M------Annual value of lives saved (1 per year) $1.25M---Time savings for commercial traffic $20 0.25 hours 250,000 trips $3M-- hour trip year $1M------Time savings for commuter and recreational traffic/year $5 0.25 hours 800,000 trips hour Hint: Benefit cost ratio = trip year Annual benefit costs/ Total cost

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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5 a. What is the payback period (Be exact to 1 decimal place) of the cash flow below? (I am attaching an image for the figure)5 b. A project has the following costs and benefits. What is the payback period (Be exact to 1 decimal place)? Year Cost Benefits0 300001-3 15,000 each year 12,000 each year4 7000 30005-10 11,000 each year
Project A Project B Year Cash Flow Year Cash Flow 0 -1,000 0 -2,000 1 900 1 900 2 900 2 900 3 900 3 900 4 900 4 900 5 5 900 6 6 900 If the discount rate is 12% and you have to choose between these two projects, what is the equivalent annual series of the best project? Question 4…
Question 7 A factory is considering partially automating one of its production processes, details can be found in the summary table below (all dollars are constant and have the value of today): Description/Data S 1,500,000 6 years S 500,000 Item Investment Project life Salvage value CCA rate Annual savings 30% S 1,000,000 $ 200,000 per year S 125,000 per year S 75,000 per year Labour Annual expenses Material Overhead Marginal tax rate Real interest rate 40% 16% AJ Ignoring for now any effect of inflation, what's the after-tax NPW ? B] If the general inflation rate during the next 6 year is expected be 4% annually, sales and operating costs are to be increased accordingly. What would be the NPW due to inflation? C] How did the NPW change? Why?
Question 3 An engineer has received two bids for an elevator to be installed in a new building. The bids, plus his evaluation of the elevators, are as follows: Bid Alternative Westinghome Itis $45,000 $54,000 Service life (year) 10 15 Engineer's evaluation Annual operating cost $2,700 $2,850 Salvage value $3,000 $4,500 If the interest rate is 10%, using the net present value method, which bid should be accepted?
Financial information about a dam project is presented in the table below. Initial investment cost ($) 340,000 Operation-maintenance expenses (annual) ($) 57,000 High repair-maintenance cost (at 10th year) ($) 411,000 Salvage value ($) 44,000 Economic life of the dam 25 years Annual interest rate 15% The kilowatt hour (kWh) of electricity will be sold at $0.45. Under these conditions, how much electricity should the dam produce annually to cover the construction costs?
1. A certain company is considering two types of machine for its operation. The data are as follows: Machine A First cost P150,000 Life 4 yrs Salvage value P15,000 Annual operating cost P48,000 Annual taxes P4,200 Annual repairs P7,200 Machine B First cost P200,000 Life 8 yrs P10,000 Salvage value Annual operating cost P32,000 Annual taxes P7,200 Annual repairs P4,200 If money is worth 12% compounded annually, compute the difference of the annual worth of the two machines.
kuzukuzu12121@outlook.com just sent here I NEED EXCEL FİLE. Determine the NPW, AW, FW and IRR of the following engineering project. Initial Cost ($400,000) The Study Period 15 years Salvage (Market) Value of the project 15% of the initial cost Operating Costs in the first year($9,000) Cost Increase 3% per year Benefits in the first year $40,000 Benefit Increase 9% per year MARR 8% per year Is the Project acceptable? WHY?
Problem 4 A contractor is considering the following three alternatives: a. Purchase a new microcomputer system for $15,000. The system is expected to last 6 years with salvage value of $1,000. b. Lease a new microcomputer system for $3,000 per year, payable in advance. The system should last 6 years. c. Purchase a used microcomputer system for $8,200. It is expected to last 3 years with no salvage value. Use a common-multiple-of-lives approach. If MARR of 8% is used, which alternative should be selected using a discounted present worth analysis? If the MARR is 12%, which alternate should be selected?
2. In the design of a new facility, the mutually exclusive alternatives in the table below are under consideration. Assume that the interest rate (MARR) is 15% per year and the analysis period is 10 years. Use the AW method to choose the best of these three design alternatives Capital investment Annual revenue less expenses Market value Useful life (years) Design 1 -$28,000 5,500 1,500 10 Design 2 -$16,000 3,300 0 10 Design 3 -$23,500 4,800 500 10
5. A small branch office of a contracting company is planning to purchase a new laser printer. Three vendors have supplied cost, useful life, and estimated salvage value data, shown in the following table. The MARR is 12%. Investment (first) cost Annual service cost Salvage value Useful life A $800 $180/yr $200 5 years Laser printer B $1,400 $150/yr $825 5 years C $900 $170/yr $100 5 years Draw cash flows for these alternatives. If the expected annual saving in labor is $500 regardless of which machine is purchased, what are the annual equivalent values of these alternatives.
! Required Information The Bureau of Indian Affairs provides various services to American Indians and Alaska Natives. The Director of Indian Health Services is working with chief physicians at some of the 230 clinics nationwide to select the better of two medical X-ray system alternatives to be located at secondary-level clinics. X-Ray Systems First cost, $ Annual operating cost, $/year Overhaul In year 3, $ Overhaul in year 4, $ Salvage value, $ Expected life, years Del Medical Siemens -210,000 -184,000 -191,000 -195,000 -26,000 -140,000 50,000 10,000 6 At 5% per year, select the more economical system. Solve using tabulated factors. The present worth of Del Medical is $-| 831620 and the present worth of Siemens is $- The more economical system is (Click to select) ▼
2. General Motors Company is considering three mutually exclusive alternatives for implementing a sustainable automotive program. Each alternative meets the same service requirements, but differences in capital costs and benefits (cost savings) exist among them. The study period is 10 years. The annual interest rate is 10%. Which alternative should be selected in view of the following estimates? Capital Cost Annual Cost Savings A $390,000 69,000 Alternative B $920,000 167,000 C $660,000 133,500 I