Considering new automated cleaning equipment

Assignment Help Microeconomics

Reference no: EM13689469

A company is considering new automated cleaning equipment. The engineer for the company has been asked to calculate the present worth of the proposed alternative. The initial cost of the machine is $78,000 and the annual saving that will be realized is $24,000. The annual operating cost will be $2,750, annual insurance is $2,200 paid at the beginning of the year, and it will need a scheduled maintenance performed at the end of the third year at a cost of $3,000. The market value at the end of the five year study period is 12.5% of the initial cost. If MARR = 8% what is the present worth of the investment?

Reference no: EM13689469

Questions Cloud

What are her accounting profits for the year : An individual leaves a college faculty, where she was earning $45,000 a year, to begin a new venture. She invests her savings of $10,000, which were earning 10 percent annually.

Types of business organization is unlimited liability : For which types of business organization is unlimited liability going to apply to- a sole proprietorship, a partnership or a corporation?

Value of cross price elasticity of demand : The value of cross price elasticity of demand between goods A and B is 0.75, while the cross price elasticity of demand between goods A and C is -1.38. Characterize A &B and A & C as substitutes or complements.

Elasticitys are one measure firms need to understand : Elasticity’s are one measure firms need to understand. Explain what an elasticity is and what it measures. What importance do you feel it is for firms to understand the elasticity of their products they are selling?

Considering new automated cleaning equipment : A company is considering new automated cleaning equipment. The engineer for the company has been asked to calculate the present worth of the proposed alternative.

Analyze a anova single factor survey results : How to analyze a ANOVA single factor survey results? There were 30 questions asked to 35 people regarding stress factors at work.

Considering replace water heater with array of solar panels : We are considering replacing your water heater with an array of solar panels. The net installed cost of the solar panels is $1,400 ($2,000 less a 30% tax credit from the government).

Standard deviation for accounting and finance graduates : While starting salaries have fallen for college graduates in many of the top hiring fields, there is some good news for business undergraduates with concentrations in accounting and finance (Bloomberg Business week, July 1, 2010).

Present worth on incremental investment : It is estimated that the annual heat-loss cost in a small power plant is $5,200. Two mutually exclusive proposals have been formulated that will reduce the loss. Proposal A will reduce heat loss by 60% and cost $3,000.

User Account

All Pages