Since these two questions are related, can you solve both?

Costs for Three-Year-Old Defender Operating and Additional Life (Years) Salvage Value Maintenance Costs 0 $153 600 122 880 $50 000 98 304 55 000 78 643 60 500 4 62 915 66 550 5 50 332 73 205 2 3 5 a) If BB uses a MARR of 15 percent, should it move the robot? (5 POINTS) 3-year-old Defender: Additional EAC EAC EAC years Salvage Maintenance Capital Maintenance Total EAC(total costs) of keeping the robot: ....... years is $.............. If so, when? Remember that the contract exists only for a further five years. (10 POINTS) b) Challenger (Move Robot): Additional EAC EAC EAC years Salvage Maintenance Capital Maintenance Total The cost of keeping the defender one more year is $................ For two years, the cost is $......... There is ....... number of additional years in the ..... ..year horizon for which the defender is ....to keep. Therefore, the robot should be . 3 SY 2020ECEF2 Name-Surname: Number: FACULTY OF ENGINEERING CIVIL ENGINEERING ECO 1852 ECONOMICS 2020 SPRING HOMEWORK-FINAL 2. Consider Brockville Brackets (BB) from Question 1 but assume that it has has a contract to produce the car assemblies for an indefinite period. If it does not move the robot, the operating and maintenance costs will be higher than expected. If it moves the robot (at a cost of $25 000), the operating and maintenance costs are expected to be what were originally expected for the robot. Furthermore, BB expects to be able to obtain new versions of the existing robot for an indefinite period in the future; each is expected to have an installation cost of $50 000. 5. A bond pays $10 000 per year for the next 10 years. The bond costs $90 000 now. Inflation is expected to be 5 percent over the next 10 years. Q5 ANSWER: a) What is the current dollar internal rate of return? (5 points) PW = + ..) Interest rate PW b) What is the real internal rate of return? (5 points) The real internal rate of return:... b) Construct a spreadsheet table showing the EAC(total costs) if Brockville Brackets moves the current robot and then keeps it for n more years, n_1, ..., 9. (5 POINTS) Moving the existing robot (challenger): Additional EAC EAC EAC years Salvage Maintenance Capital Maintenance Total Costs for Three-Year-Old Defender Operating and Additional Life (Years) Salvage Value Maintenance Costs 0 $153 600 122 880 $50 000 98 304 55 000 78 643 60 500 4 62 915 66 550 5 50 332 73 205 2 3 5 a) If BB uses a MARR of 15 percent, should it move the robot? (5 POINTS) 3-year-old Defender: Additional EAC EAC EAC years Salvage Maintenance Capital Maintenance Total EAC(total costs) of keeping the robot: ....... years is $.............. If so, when? Remember that the contract exists only for a further five years. (10 POINTS) b) Challenger (Move Robot): Additional EAC EAC EAC years Salvage Maintenance Capital Maintenance Total The cost of keeping the defender one more year is $................ For two years, the cost is $......... There is ....... number of additional years in the ..... ..year horizon for which the defender is ....to keep. Therefore, the robot should be . 3 SY 2020ECEF2 Name-Surname: Number: FACULTY OF ENGINEERING CIVIL ENGINEERING ECO 1852 ECONOMICS 2020 SPRING HOMEWORK-FINAL 2. Consider Brockville Brackets (BB) from Question 1 but assume that it has has a contract to produce the car assemblies for an indefinite period. If it does not move the robot, the operating and maintenance costs will be higher than expected. If it moves the robot (at a cost of $25 000), the operating and maintenance costs are expected to be what were originally expected for the robot. Furthermore, BB expects to be able to obtain new versions of the existing robot for an indefinite period in the future; each is expected to have an installation cost of $50 000. 5. A bond pays $10 000 per year for the next 10 years. The bond costs $90 000 now. Inflation is expected to be 5 percent over the next 10 years. Q5 ANSWER: a) What is the current dollar internal rate of return? (5 points) PW = + ..) Interest rate PW b) What is the real internal rate of return? (5 points) The real internal rate of return:... b) Construct a spreadsheet table showing the EAC(total costs) if Brockville Brackets moves the current robot and then keeps it for n more years, n_1, ..., 9. (5 POINTS) Moving the existing robot (challenger): Additional EAC EAC EAC years Salvage Maintenance Capital Maintenance Total