Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Two 180-horsepower (HP) motors are being considered for installation at a municipal sewage- treatment plant. Motor 1 cost $5,800 and has an operating efficiency

image text in transcribed

1. Two 180-horsepower (HP) motors are being considered for installation at a municipal sewage- treatment plant. Motor 1 cost $5,800 and has an operating efficiency of 83%. Motor 2 costs $4,600 and has an efficiency of 80%. Both motors are projected to have zero salvage value after a life of 10 years. Let all the annual charges, such as insurance, maintenance, etc., amount to a total of 15% of the original cost of each motor and power costs be $0.05/kWh. Let the number of hours of full-load operation per year be denoted T. For what values of T is the purchase of Motor 1 justified if i - 6%? = We found that purchasing Motor 1 is justified for T> 1,132 hours/year. a.) Write out a solution to this problem neatly, showing the intermediate steps to arrive at T>1,132 hours/year. I suggest considering part (b) to determine how to write this out efficiently. b.) Consider the problem but let the efficiency of Motor 1 be 84%. Find the values of T that justify the purchase of Motor 1 in this case. c.) How does the answer to (b) compare to the answer of (a) (e.g., lower, same, greater threshold value)? Briefly explain why this answer makes sense in terms of the real world interpretation of the problem. 1. Two 180-horsepower (HP) motors are being considered for installation at a municipal sewage- treatment plant. Motor 1 cost $5,800 and has an operating efficiency of 83%. Motor 2 costs $4,600 and has an efficiency of 80%. Both motors are projected to have zero salvage value after a life of 10 years. Let all the annual charges, such as insurance, maintenance, etc., amount to a total of 15% of the original cost of each motor and power costs be $0.05/kWh. Let the number of hours of full-load operation per year be denoted T. For what values of T is the purchase of Motor 1 justified if i - 6%? = We found that purchasing Motor 1 is justified for T> 1,132 hours/year. a.) Write out a solution to this problem neatly, showing the intermediate steps to arrive at T>1,132 hours/year. I suggest considering part (b) to determine how to write this out efficiently. b.) Consider the problem but let the efficiency of Motor 1 be 84%. Find the values of T that justify the purchase of Motor 1 in this case. c.) How does the answer to (b) compare to the answer of (a) (e.g., lower, same, greater threshold value)? Briefly explain why this answer makes sense in terms of the real world interpretation of the

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managing Finance A Socially Responsible Approach

Authors: D. Crowther

1st Edition

0750661011, 978-0750661010

More Books

Students also viewed these Finance questions

Question

Find all cosets of the subgroup (18) of Z 36 .

Answered: 1 week ago