Question
1. the MARR is 15%. Three alternatives are available and the associated cash flow is as follow: Year A B C First Cost $1,700 $2,100
1. the MARR is 15%. Three alternatives are available and the associated cash flow is as follow:
Year | A | B | C |
First Cost | $1,700 | $2,100 | $3,750 |
Annual Benefit | $1,000 | $1,000 | $1,000 |
Useful Life | 2 | 3 | 6 |
Answer the following in this format: 1.23
The payback period for Alternative A is
The payback period for Alternative B is
The payback period for Alternative C is
Based on Payback period analysis, Alternative should be selected
2.
Find the conventional payback period for the following project:
First Cost | $10,000 |
Maintenance | $500 in Year 1, increasing by $200/year |
Income | $3,000/year |
Salvage | $4,000 |
Useful Life | 10 years |
MARR | 10% |
in years
3.
With interest at 10%, what is the benefit-cost ratio for this government project?
Initial Cost | $202295 |
Additional costs at the end of year 1 and year 2 | $34284/year |
Benefits at end of year 1 and year 2 | $0/year |
Annual benefits at end of year 3 through year 10 | $100320/year |
4.
A tax exempt municipality is considering the construction of a new municipal waste water treatment facility. Two different sites have been selected as technically, politically, socially, and financially feasible. The city council uses 6% interest rate for all analyses for public projects. The expected cash flow for the two alternatives are as follow:
Year | Alt. A | Alt. B |
0 | - $16293948 | - $27246080 |
1 - 75 | $1620181/year | $2829425/year |
What is the incremental benefit/cost ratio?
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