Basics Of Engineering Economy
2nd Edition
ISBN: 9780073376356
Author: Leland Blank, Anthony Tarquin
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 1, Problem 31P
To determine
Whether the given statement is correct.
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An engineer told you that a project is economically acceptable when it’s rate of return equals or exceeds the corporation’s cost of capital. Is this correct? Explain your answer.
“The higher the MARR, the higher the price that a company should be willing to pay for equipment that reduces annual operating expenses.” Do you agree with this statement? Explain your answer.
Is it always possible for the cash borrowed (released) from a project tobe reinvested to yield a rate of return equal to that received from the project?
Chapter 1 Solutions
Basics Of Engineering Economy
Ch. 1 - Prob. 1PCh. 1 - Which of the following would be considered...Ch. 1 - Prob. 3PCh. 1 - Prob. 4PCh. 1 - Prob. 5PCh. 1 - Prob. 6PCh. 1 - Prob. 7PCh. 1 - Prob. 8PCh. 1 - Prob. 9PCh. 1 - What is meant by the term time value of money?
Ch. 1 - Prob. 11PCh. 1 - Of the fundamental dimensions length, mass, time,...Ch. 1 - Prob. 13PCh. 1 - When an interest rate statement does not include a...Ch. 1 - Prob. 15PCh. 1 - Prob. 16PCh. 1 - Prob. 17PCh. 1 - Prob. 18PCh. 1 - Prob. 19PCh. 1 - Prob. 20PCh. 1 - Prob. 21PCh. 1 - Prob. 22PCh. 1 - Prob. 23PCh. 1 - Prob. 24PCh. 1 - Prob. 25PCh. 1 - Prob. 26PCh. 1 - Prob. 27PCh. 1 - Prob. 28PCh. 1 - How many years does it take for an investment of...Ch. 1 - Prob. 30PCh. 1 - Prob. 31PCh. 1 - Prob. 32PCh. 1 - Prob. 33PCh. 1 - Prob. 34PCh. 1 - Prob. 35PCh. 1 - Prob. 36PCh. 1 - Prob. 37PCh. 1 - Prob. 38PCh. 1 - Prob. 39PCh. 1 - Prob. 40PCh. 1 - Prob. 41PCh. 1 - Prob. 42PCh. 1 - Prob. 43PCh. 1 - Prob. 44PCh. 1 - At 9% per year simple interest, 1000 is equivalent...Ch. 1 - Prob. 46PCh. 1 - Prob. 47PCh. 1 - Prob. 48PCh. 1 - Prob. 49PCh. 1 - Prob. 50PCh. 1 - Prob. 51PCh. 1 - Prob. 52PCh. 1 - Prob. 53PCh. 1 - Prob. 54PCh. 1 - Prob. 55PCh. 1 - Prob. 56PCh. 1 - Prob. 57PCh. 1 - Prob. 58PCh. 1 - Prob. 59PCh. 1 - Prob. 60PCh. 1 - Prob. 61PCh. 1 - Prob. 62PCh. 1 - Prob. 63PCh. 1 - Prob. 64PCh. 1 - Prob. 65PCh. 1 - Prob. 66PCh. 1 - Prob. 67PCh. 1 - Prob. 69APQCh. 1 - Prob. 70APQCh. 1 - Prob. 71APQCh. 1 - Prob. 72APQCh. 1 - An investment of 8,000 nine years ago has...Ch. 1 - Prob. 74APQCh. 1 - Prob. 75APQCh. 1 - Prob. 76APQCh. 1 - Prob. 77APQ
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Similar questions
- Describe the method for determining the length of time required to recover the cost of investment?arrow_forwardIt is the sum of all costs that are incurred periodically and continuously in order that the project in which an investment has been made may be operated, produce a commodity or service and distribute and sell that commodity or service. Salvage cost Profit Operating cost Fixed costarrow_forwardMBA Company sells a single product for 2500 HUF/unit. You know the following information: The total cost function is: K(x) = 240 000 000 + 1 300 * x. The owner's equity counts for 300 million HUF. The debt (average) is 100 million HUF. The calculated rate of capital yield requirement is 17.5 percent. The interest of the debt is 10 percent. Amortisation takes 120 million HUF. Management believes, that the real opportunity for the company is selling of 150 000 units. Choose the missing answers! As the turning point of profitability is • units, the company will realize a of HUF in case of selling 150 000 units. In case of that volume the selling price should be HUF per unit in order to company's operation be profitable.arrow_forward
- The authors mention in a few places in the chapter that benefits are overestimated while costs tend to be underestimated—they called this the “optimist’s bias.” What do they mean by this, and what effect can it have on the fair evaluation of projects?arrow_forwardIs the cost of the final product proportionate to its usefulness?arrow_forward#19, ENGINEERING ECONOMICSarrow_forward
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