Answered step by step
Verified Expert Solution
Question
1 Approved Answer
1. An environmental engineer will establish a retirement account. He desires to have $1,000,000 in his account at the end of 35 years. If he
1. An environmental engineer will establish a retirement account. He desires to have $1,000,000 in his account at the end of 35 years. If he will earn interest at an annual rate of 4.5%, how much money must he put into the account each year? 2. A recently graduated geotechnical engineer wants to buy a new sports car. The cost of the car is $37,000. What will her monthly payments be if she finances the cost over six years at an annual interest rate of 7%? 3. An engineering firm is looking for a new office. The lease term will be 15 years. The firm is considering Office A and Office B. Office A is 8,500 sq. ft. and rents for $21/sq. ft. per year. The rent will not increase over the life of the lease. The rent is payable in equal monthly payments. Office B is 7,000 sq. ft. and rents $15/sq. ft. initially and will increase by $1/sq. ft. each year. The rent is payable in equal monthly payments. The initial cost to furnish and equip the office is $75,000. The office furniture will have a salvage value of $8,000 at the end of the lease period. Assume an interest rate of 6%. What is the lower present value of the two office options? 4. A highway needs to be reconstructed. Two alternatives are being considered, a concrete pavement and an asphalt pavement. Both options have a service life of 45 years. The treatments expected during the life of each pavement are shown in the table below. Assume an interest of 4%. Which is the most cost-effective pavement option, based on present worth? Alternative Initial Annual | Maintenance | Rehabilitation Construction | Maintenance | Resurfacing & Overlay A-Concrete $7,000,000 $18,000 Year 15 $500,000 Year 30 $900,000 B - Asphalt $4,200,000 $30,000 Year 8 $300,000 | Year 15 $400,000 Year 23 $300,000 Year 30 $750,000 Year 38 $300,000 5. What is the maximum price you would pay for a bond if your Minimum Acceptable Rate of Return (MARR) is 7%, the bond face value is $25,000, and the coupon rate is 3%, paid semi-annually
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started