A transit system is estimated to cost $2,000,000 with operating and maintenance costs starting at $28,000...
A transit system is estimated to cost $2,000,000 with operating and maintenance costs starting at $28,000 per year (end of year 1), but increasing by 10% per year for the next 11 years (i.e. your total time period is 12 years). At the end of the 6th year, it is anticipated that new equipment and buses will be needed at a total cost of $3,000,000. Calculate the present worth of costs for this system if the rate of return is 9.5% per year. Please draw the conceptual cash flow diagram for this (you do not need to label all cash flow values, just the approximate shape of it).
Homework Answers
Calculation of present worth of costs:
Cash Flow Diagram:
Add Answer to:
A transit system is estimated to cost $2,000,000 with operating
and maintenance costs starting at $28,000...
A machine which initially costs $14,000 has operating costs of $800 per year. These operating costs...
A machine which initially costs $14,000 has operating costs of $800 per year. These operating costs include routine maintenance, but additional major overhauls costing $1,600 each are anticipated in years 2, 4, and 6. The machine is sold for its salvage value of $2,400 at the end of year 7. The machine's owners use an interest rate of 8% for their financial analysis. a) Draw the cash flow diagram for this scenario. b) What is the net present value of...
1. A construction company operates a bulldozer that initially cost $28,000. The first year maintenance is...
1. A construction company operates a bulldozer that initially cost $28,000. The first year maintenance is $600, the second year is $900, and the third year is $1200. The salvage value at the end of the third year is $15,000. If the company decides to keep the bulldozer beyond the third year, the maintenance costs are $900 the fourth year, $1150 the fifth year, and $1300 the sixth year. There is a $7000 cost for overhaul if the bulldozer is...
The maintenance cost is incurred at the end of the year Two machines are being considered...
The maintenance cost is incurred at the end of the year
Two machines are being considered for the same task. Machine A costs $18,000 new and is estimated to last 6 years. The cost to replace machine A after 6 years will be $23,000. Machine A will cost $1,200 per year to operate/maintain and it will have a trade-in (salvage) value of $1,500. Machine B costs $38,000 to buy, will last 12 years and will have a trade in value...
5) (17 points) Maintenance costs for a bridge are cyclic with the following costs occurring over...
5) (17 points) Maintenance costs for a bridge are cyclic with the following costs occurring over a 5-year period. MARR is 10% per year compounded annually. EOY 2 3 5 Maintenance S50 million $75 million $75 million $75 million $150 million Cost 1 4 a) (14 points) Compute an equivalent uniform annual cost over a single 5-year maintenance cycle. b) (3 points) It is anticipated that the sequence of costs will repeat every 5 years forever. If so, determine the...
please add the cash flow diagram as well b Problem 1. The maintenance cost for a...
please add the cash flow diagram as well
b Problem 1. The maintenance cost for a certain machine is $1000 per year for the first 5 years and S2000 per year for the next 5 years. At an interest rate of 10% per year, the annual worth in years 1 through 10 of the maintenance cost is closest to Answer: CFD: Equation:
Please draw cash flow digram please Problem 1 Aerotron Electronics is considering the purchase of a...
Please draw cash flow digram please
Problem 1 Aerotron Electronics is considering the purchase of a water filtration system to assist in circuit board manufacturing. The system costs $40,000. It has an expected life of 7 years at which time its salvage value will be $7,500. Operating and maintenance expenses are estimated to be $2,000 per year. If the filtration system is not purchased, Aerotron Electronics will have to pay Bay City $12,000 per year for water purification. If the...
2. A laser cutting machine is purchased today for $23,000. There are no maintenance costs for...
2. A laser cutting machine is purchased today for $23,000. There are no maintenance costs for the next two years. Maintenance at the end of year 3 is expected to be $2,000, with each subsequent year’s maintenance costs exceeding the previous year by $1,000. An increase in revenues of $14,000 per year is expected during this time period. The planning horizon is 6 years. Draw the cash flow diagram.
A new manufacturing plant costs $5,500,000 to build. Operating and maintenance costs are estimated to be...
A new manufacturing plant costs $5,500,000 to build. Operating and maintenance costs are estimated to be $41,000 per year, and a salvage value of 25% of the initial cost is expected. The units the plant produces are sold for $40 each. Sales and production are designed to run 365 days per year. The planning horizon is 10 years. Find the break-even value for the number of units sold per day for each of the following values of MARR: 5% 10%...
PROBLEM NO. 4 Machine X has an initial cost of $10,000, annual maintenance of $500 per...
PROBLEM NO. 4 Machine X has an initial cost of $10,000, annual maintenance of $500 per year, and no salvage value at the end of its four-year useful life. Machine Y costs $20,000. The first year there is no maintenance cost. The second year, maintenance is $100, and increases $100 per year in subsequent years. The machine has an anticipated $5,000 salvage value at the end of its 12-year useful life. If interest is 8%, which machine should be selected?...
O pts Question 2 If a solar panel system has an increasing annual maintenance cost (an...
O pts Question 2 If a solar panel system has an increasing annual maintenance cost (an arithmetic gradient) of $500 per year over an 8 year period THAT STARTS AT YEAR 4, then what is the present value based on 10% interest? To be clear: the total period is 12 years with an 8 year gradient starting in year 4. O pts Question 3 If we add an $800 uniform annual payment to the solar panel system of problem #2...
1. A construction company operates a bulldozer that initially cost $28,000. The first year maintenance is $600, the second year is $900, and the third year is $1200. The salvage value at the end of the third year is $15,000. If the company decides to keep the bulldozer beyond the third year, the maintenance costs are $900 the fourth year, $1150 the fifth year, and $1300 the sixth year. There is a $7000 cost for overhaul if the bulldozer is...
The maintenance cost is incurred at the end of the year
Two machines are being considered for the same task. Machine A costs $18,000 new and is estimated to last 6 years. The cost to replace machine A after 6 years will be $23,000. Machine A will cost $1,200 per year to operate/maintain and it will have a trade-in (salvage) value of $1,500. Machine B costs $38,000 to buy, will last 12 years and will have a trade in value...
5) (17 points) Maintenance costs for a bridge are cyclic with the following costs occurring over a 5-year period. MARR is 10% per year compounded annually. EOY 2 3 5 Maintenance S50 million $75 million $75 million $75 million $150 million Cost 1 4 a) (14 points) Compute an equivalent uniform annual cost over a single 5-year maintenance cycle. b) (3 points) It is anticipated that the sequence of costs will repeat every 5 years forever. If so, determine the...
please add the cash flow diagram as well
b Problem 1. The maintenance cost for a certain machine is $1000 per year for the first 5 years and S2000 per year for the next 5 years. At an interest rate of 10% per year, the annual worth in years 1 through 10 of the maintenance cost is closest to Answer: CFD: Equation:
Please draw cash flow digram please
Problem 1 Aerotron Electronics is considering the purchase of a water filtration system to assist in circuit board manufacturing. The system costs $40,000. It has an expected life of 7 years at which time its salvage value will be $7,500. Operating and maintenance expenses are estimated to be $2,000 per year. If the filtration system is not purchased, Aerotron Electronics will have to pay Bay City $12,000 per year for water purification. If the...
PROBLEM NO. 4 Machine X has an initial cost of $10,000, annual maintenance of $500 per year, and no salvage value at the end of its four-year useful life. Machine Y costs $20,000. The first year there is no maintenance cost. The second year, maintenance is $100, and increases $100 per year in subsequent years. The machine has an anticipated $5,000 salvage value at the end of its 12-year useful life. If interest is 8%, which machine should be selected?...
O pts Question 2 If a solar panel system has an increasing annual maintenance cost (an arithmetic gradient) of $500 per year over an 8 year period THAT STARTS AT YEAR 4, then what is the present value based on 10% interest? To be clear: the total period is 12 years with an 8 year gradient starting in year 4. O pts Question 3 If we add an $800 uniform annual payment to the solar panel system of problem #2...
Most questions answered within 3 hours.
-
Where is the error in this code sequence?
String s1 = "Hello";
String s2 = "ello";...
asked 10 months ago -
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance...
asked 10 months ago -
Consider this reaction:
Al2(SO4)3 (aq)+ BaCl3
(aq) Al2Cl6 (aq)- +
3BaSO4(s) . What is the...
asked 10 months ago -
Suppose that Savneet is considering increasing her
recent random sample from 20 car rentals to 40...
asked 10 months ago -
Trucks arrive at an unloading terminal at an average rate of 120
per hour.
Trucks arrive...
asked 10 months ago -
Why are methanol and ethanol completely soluble in water while
octanol is not very little soluble....
asked 10 months ago -
A facilities manager at a university reads in a research report
that the mean amount of...
asked 10 months ago -
When the CuSO4 is rehydrated by adding water to the anhydrous
compound, is this an endothermic...
asked 10 months ago -
A ray of sunlight is passing from diamond into crown glass; the
angle of incidence is...
asked 10 months ago -
A block of mass 0.249 kg is placed on top of a light, vertical
spring of...
asked 10 months ago -
how do the kidneys compensate in the presences of acidosis
a) trigger hyperventilate
b) reserve acid...
asked 10 months ago -
Question 501 pts
The rental rate of capital to the firm increases. Which of the
following...
asked 10 months ago