Answered step by step
Verified Expert Solution
Question
1 Approved Answer
the image is clear you just have to open the image in new window... no doesn't need more information I have sent everything . no
the image is clear you just have to open the image in new window... no doesn't need more information I have sent everything . no one able to solve it ???
Individual industries will use energy as efficiently as it is economical to do so, and there are several incentives to improve the efficiency of energy consumption. To illustrate, consider the selection of a new water pump. The pump is to operate 800 hours per year. Pump A costs $1,900, has an overall efficiency of 82.49%, and it delivers 11.5 hp. The other available alternative, pump B, costs $900, has an overall efficiency of 45.37%, and delivers 11.9 hp. Both pumps have a useful life of five years and will be sold at that time. (Remember 1 hp = 0.746 kW.) Pump A will use SL depreciation over five years with an estimated SV of zero. Pump B will use the MACRS depreciation method with a class life of three years. After five years, pump A has an actual market value of $420, and pump B has an actual market value of $220. Using the IRR method on the after-tax cash flows and a before-tax MARR of 18%, is the incremental investment in pump A economically justifiable? The effective income tax rate is 29%. The cost of electricity is $0.05/kWh, and the pumps are subject to a study period of five years. Click the icon to view the GDS Recovery Rates (rk) for the 3-year property class. More Info The IRR of the incremental investment is 1%. (Round to one decimal place.) GDS Recovery Rates (TK) Year 3-year Property Class 1 0.3333 2 0.4445 3 0.1481 4 0.0741 Individual industries will use energy as efficiently as it is economical to do so, and there are several incentives to improve the efficiency of energy consumption. To illustrate, consider the selection of a new water pump. The pump is to operate 800 hours per year. Pump A costs $1,900, has an overall efficiency of 82.49%, and it delivers 11.5 hp. The other available alternative, pump B, costs $900, has an overall efficiency of 45.37%, and delivers 11.9 hp. Both pumps have a useful life of five years and will be sold at that time. (Remember 1 hp = 0.746 kW.) Pump A will use SL depreciation over five years with an estimated SV of zero. Pump B will use the MACRS depreciation method with a class life of three years. After five years, pump A has an actual market value of $420, and pump B has an actual market value of $220. Using the IRR method on the after-tax cash flows and a before-tax MARR of 18%, is the incremental investment in pump A economically justifiable? The effective income tax rate is 29%. The cost of electricity is $0.05/kWh, and the pumps are subject to a study period of five years. Click the icon to view the GDS Recovery Rates (rk) for the 3-year property class. More Info The IRR of the incremental investment is 1%. (Round to one decimal place.) GDS Recovery Rates (TK) Year 3-year Property Class 1 0.3333 2 0.4445 3 0.1481 4 0.0741Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started