Compare the following 2 alternatives using the Net Equivalent Uniform Annual (NEUA) method and the given interest rate of 4.5%
Draw the Cash Flow Diagram
|
Alt. |
Construction cost $ |
Benefit ($/yr) |
Salvage $ |
Service Life (yrs) |
|
A |
1,800,000 |
400,000 |
40,000 |
7 |
|
B |
2,900,000 |
550,000 |
80,000 |
14 |
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Compare the following 2 alternatives using the Net Equivalent Uniform Annual (NEUA) method and the given...
The rate is 2.75%
5. Copmare the following 2 altrernatives using the Net Equivalent Uniform Annual method Alt. Construction cost $ Benefit ($/yr) Salvage $ Service Life (yrs) A 1,500,000 400,000 40,000 9 B 2,300,000 550,000 80,000 18
Compare the following 2 alternatives using the Net Present Worth (NPW) method – rate is 4.5% per year. Repeat the solution using the Net Equivalent Uniform Annual (NEUA) method. Which one is simpler? Draw all cash flow diagrams. Alt. Construction Cost Benefit Maintenance Service Life A $380,000 $240,000/yr. $10,000/yr. 9 yrs B $750,000 $270,000/yr. $20,000/yr. 18 yrs
Compare the following 2 alternatives using the Net Present Worth (NPS) method – rate is 3% per year. Draw all cash flow diagrams. Please show work using a formula. Alt. Construction Cost ($) Benefit ($/yr.) Service Life (yrs.) A 380,000 200,000 7 B 450,000 220,000 7
6. Compre the following alternatives using the Net Equivalent Uniform Annual Worth method. Alt. Construction cost $ Life (yrs) A $30million 40 B $35million Infinite
5. Compare the following two alternatives by the IRR method, given MARR of 8%/year. Is the incement in cost form A to B justified? Alt. Construction cost | Benefits Styr | Salvage Service Life (yrs 510,000 145,000 10,000 775,000 155,000 20,000
3. Compare the two following two alternatives using an equivalent worth method and a MARR of 12%. The repeatability assumption is acceptable. Aternative I: Initial investment of $45,000, net revenue the first year of $8,000, increasing $4,000 per year for the six year useful life. Salvage value is estimated to be $6500. Alternative II: Initial investment of $60,000, uniform annual revenue of $12,000 for the five year useful life. Slavage value is estimated to be $9,000.
4. Compare the following altemtives given a market rate of 3.45% per year and an inflation rate of 3% per year. Use first the B/C method to determine feasibility and then the incremental B/C method to determine the oprimum level of investment. Life yrs Alt A Construction Costs Annual Benefits S/yr 105,000 40,000 230,000 52.000 350.000 64,000 600,000 100,000 6
Compare the following alterntives given a market rate of 5.45% per year and an inflation rate of 3% per year. Use first the B/C method to determine feasibility and then the incremental B/C method to determine the oprimum level of investment. Alt Construction Cost $ Annual Benefits $/yr Life yrs A 105,000 40,000 5 B 230,000 52,000 6 C 350,000 64,000 7 D 600,000 100,000 8
Compare the following alterntives given a market rate of 5.45% per year and an inflation rate of 3% per year. Use first the B/C method to determine feasibility and then the incremental B/C method to determine the oprimum level of investment. Alt Construction Cost $ Annual Benefits $/yr Life yrs A 105,000 40,000 5 B 230,000 52,000 6 C 350,000 64,000 7 D 600,000 100,000 8
2. Consider the following two mutually exclusive alternatives: Cost, $ Uniform annual benefit, $ Useful life, years 100,000 16,000 150,000 24,000 Using a 10% interest rate, and an annual cash flow analysis, determine which alternative should be selected. Draw the CFD.