Reference no: EM13857217

1. The Deadeye Distillery is opening a new production facility at Sweetwater Springs. Two types of stills are being considered and the following cost estimates have been developed:

Data	Alternative
	MASHER	SQUEEZER
Life. Years	4	6
First Cost	$10,000	S15,000
Salvage Value	$0	$2,000
M&O Cost	$500	51,000
M&O Gradient	$:_00,	$400

Using the present worth analysis, determine which alternative should selected. MARR = 25%.

2. Use an interest rate of 12% and determine the capitalized equivalent of the following cash flow system.

Year	1	2	3	4	5	6	7	8	9	10	11	--
Cash Flow, $	850	700	550	400	250	100	850	700	550	400	250	--

3. The first cash flow of a 25-year series of quarterly cash flows is equal to $35,000. Each cash flow in the series increases by $800. Find the amount of each cash flow in an equal quarterly cash flow series that is equivalent to the increasing cash flow series. The interest rate is 14% and compounding is done quarterly.