Question
An engineer is trying to decide which process to use to reduce sludge volume prior to disposal. Belt filter presses (BFP) will cost $203000 to
An engineer is trying to decide which process to use to reduce sludge volume prior to disposal. Belt filter presses (BFP) will cost $203000 to buy and $85000 per year to operate. Belts will be replaced one time per year at a cost of $5500. Centrifuges (Cent) will cost %396000 to buy and $119000 per year to operate, but because the centrifuge will produce a thicker "cake" the sludge hauling cost to monofill will be $37000 per year less than for the belt presses. The useful lives are 5 and 10 years for alternatives BFP and Cent, respectively, and the salvage values are assumed to be 10% of the first cost of each process whenever they are closed or replaced. Use PW evaluation to select the more economical process at an interest rate of 6% per year over a) the LCM of lives and b)) a study period of 8 years. Are the decisions the same?
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