answer these problems
In looking for ways to cut costs and increase profit (to make the company's stock go up), one of the company's industrial engineers (IEs) de- termined that the equivalent annual worth of an existing machine over its remaining useful life of 3 years will be $-70,000 per year. The IE also determined that a replacement with more ad- vanced features will have an AW of $ 80,000 per year if it is kept for 2 years or less, $-75,000 if it is kept between 3 and 4 years, and $ 65,000 if it is kept for $ to 10 years. If the engineer uses a 3-year study period and an interest rate of 13% per year, she should recommend that the existing machine bbe: [a) Replaced now (5] Replaced I year from now (c) Replaced 2 years from now fa) Notreplaced The equivalent annual worth of an existing ma- chine at American Semiconductor is estimated to be $ 70,000 per year over its remaining useful life of 3 years. It can be replaced now or later with a machine that will have an AW of $ 90,000 per year if it is kept for 2 years or less, -$65,000 if it is kept between 3 and 3 years, and $-110,000 if it is kept for 6 to 8 years. The company wants an analysis of what it should do for a 3-year study period at an interest rate of 15% per year. The re- placement must be made now or 3 years from now, according to the department supervisor. You should recommend that the existing machine be replaced: (a) Now (5) 1 year from now (c) 2 years from now a) Can't tell; must find AW of different reten- tion combinations for the two machinesWe continue with the progressive example of possibly replacing a kiln at B&T Enterprises. A marketing study revealed that the improving business activity on the west coast implies that the revenue profile between the installed kiln (PT) and the proposed new one (GH) would be the same, with the new kiln possibly bringing in new revenue within the next couple of years. The president of B&T decided it was time to do a replacement study. Assume you are the lead engineer and that you previously completed the ESL analysis on the challenger (Exam- ple 11 3) It indicates that for the GH system the ESL is its expected useful life. Challenger: ESLA = 12 years with total equivalent annual cost AW= $-12.32 million The president asked you to complete the replacement study, stipulating that, due to the rapidly rising annual operating costs (AOC), the defender would be retained a maximum of 6 years. You are expected to make the necessary estimates for the defender (PT) and perform the study at a 15%% per year retum.\f\f\f
