Find the simple payback period

Reference no: EM131506742

Question: Refer to Problem. If the government expects inflation to average 3% per year, what is the equivalent uniform annual savings in fuel (jet fuel savings will be $2.5 billion one year from now). MARR remains at 7% per year (im).

Problem: The Fischer-Tropsch (F-T) process was developed in Germany in 1923 to convert synthesis gas (i.e., a mixture of hydrogen and carbon monoxide) into liquid with some gaseous hydrocarbons. Interestingly, the F-T process was used in World War II to make gasoline and other fuels.

a. If the U.S. military can save one billion gallons per year of foreign oil by blending its jet fuel with F-T products, how much can the government afford to invest (through tax breaks and subsidies) in the F-T industry in the United States? The government's MARR is 7% per year, the study period is 40 years, and one gallon of jet fuel costs $2.50.

b. If Congress appropriates $25 billion to support the F-T process industry, what is the simple payback period?

Reference no: EM131506742

Questions Cloud

Explain to mr skaros why his production cost report showed : Prepare a maximum 700-word informal memo and explain to Mr. Skaros why his production cost report showed only 2,000 equivalent units in ending inventory.

Elements of a history of present illness : 1. List the typical elements of a history of present illness. 2. List at least three drawbacks of handwritten patient charts.

Did you make a sound economical decision : The cost of first-class postage has risen by about 5% per year over the past 30 years. The U.S. Postal Service introduced a one-time forever stamp in 2008.

What is first year debt coverage ratio : You are an employee of University Consultants, Ltd., and have been given thefollowing assignment. What is the first year debt coverage ratio?

Find the simple payback period : Refer to Problem. If the government expects inflation to average 3% per year, what is the equivalent uniform annual savings in fuel.

A crisis for the catholic church : The Protestant Reformation, which began in 1517, did significant damage to the power and influence of the Catholic Church. Prior to the Protestant Reformation.

What is the controversy : The purpose of the research proposal is to help you to understand your project, to gain direction and feedback on your project

Before-tax internal rate of return on equiity invested : What is the investor's expected before-tax internal rate of return on equiity invested (BTIRR)

Example of type of environment : A good example of this type of environment might be sales team or a project team working to submit a competitive proposal.

User Account

All Pages