Engineering economics
SHOW WORK AND STEPS USING ATTACHED TABLE
By spending $20K now, $25K three years from now, and $30K five years from now to upgrade presently owned equipment, a company can increase its annual revenue by $15K in years 1 through 5 and by $18K per year in years 6 through 10. At an interest rate of 6% per year, compounded yearly, what is the net present value of the proposed upgrade?
6% 10 11 12 13 14 15 16 17 18 20 21 22 23 25 26 27 28 29 30 31 32 33 34 35 40 45 50 55 Compound Interest Factors Single Payment Uniform Payment Series Arithmetic Gradient Compound Present Sinking Capital Compound Present Gradient Gradient Amount Worth Fund Recovery Amount Worth Uniform Present Worth Factor Factor Factor Factor Factor Factor Series Find F Find P Find p Find P Find A Find A Find F Find A Given P Given G Given G Given F Given F Given P Given A Given A F/P P/F A/F AVP FVA P/A A/G P/G 1.060 9434 0.943 1.0000 1.0600 1.000 1,124 8900 4854 5454 2.060 1.833 0.485 0.890 1,191 8396 3141 3741 3.184 2.569 2.673 0.961 1.262 7921 2286 2886 4.375 3.465 1.427 4.945 1.338 7473 1774 4.212 1.884. 7.934 2374 5.637 1.419 7050 1434 2034 6.975 4.917 2.330 11.459 1.504 665 1191 1791 8.394 5.582 2.768 15.450 6274 1.594 1010 1610 9.897 6.210 3.195 19.841 1.689 5919 0870 1470 11.49 6.802 3.613 24.577 1.791 5584 0759 1359 13.181 7.360 4.022 29.602 1.898 5268 0668 14.972. 4.421 34.870 1268 7.887 2.012 4970 40.337 0593 1193 16.870 8.384 4.811 2.133 4688 0530 1130 18.882 8.853 5.192 45.963 2.261 4423 0476 1076 5.564 51.713 21.015 9.295 2.397 4173 0430 1030 23.276 9.712 5.926 57.554 2.540 3936 ,0390 0990 25.672 10.106 6.279 63.459 2.693 3714 0354 0954 28.213 10.477 6.624 69.401 2.854 3503 0324 0924 10,828 6.960 75.357 30.906 3.026. 3305 0296 0896 33.760 11.158 7.287 81.306 3.207 36,786 3118 0272 0872 11.470 7.605 87.230 3.400 2942 0250 0850 39.993 11.764 7.915 93.113 3.604 2775 0230 0830 43.392 98.941 12.04.2 8.217 3.820 2618 0213 0813 46,996 12,303 8.510 104.700 4.049 2470 0197 0797 50,815 12.550 8.795 110.381 4.292 2330 0182 0782 54.864. 12.783 9.072 115.973 4.549 2198 0169 0769 59,156 13.003 9.341 21.468 4.822 2074 0157 0757 63,706 13.211 9.603 126.860 5.112 1956 0146 0746 68.528 13.406 9.857 132.142 5.418 1846 0136 73.640 0736 13.591 10.103 137.309 5.743 1741 0126 0726 79,058 13.765 10.342 142.359 6.088 1643 0118 0718 84.801 13.929 10.574 147.286 6.453 1550 0110 0710 90.890 14.084 10.799 152.090 6.841 1462 0103 0703 97.343 14.230 11.017 156.768 7.251 1379 00960 0696 104.184. 14.368 11.228 161.319 7.686 1301 00897 0690 111.435 14.498 11,432 165.743 10.286 0972 ,00646 0665 154.762 15.046 12.359 185.957 13.765 0727 00470 0647 212.743 15.456 13, 141 203.109 18.420 0543 00344 0634 290.335 15,762 13,796 217.457 24,650 0406 00254 0625 394.171 15.991 14,341 229.322 6% 10 11 12 13 14 15 17 19 20 21 22 24 25 26 27 28 29 30 31 32 34 35 40 45 50 55
