Installation at municipal sewage-treatment plant

Assignment Help Financial Management
Reference no: EM131605859

Two 180-horsepower (HP) motors are being considered for installation at a municipal sewage-treatment plant. The first costs $5,800 and has an operating efficiency of 77%. The second costs $4,400 and has an efficiency of 74%. Both motors are projected to have zero salvage value after a life of 10 years. If all the annual charges, such as insurance maintenance, etc., amount to a total of 18% of the original cost of each motor, and if power costs are a flat five cents per kilowatt-hour, how many minimum hours of full-load operation per year are necessary to justify purchasing the more expensive motor at i=6% (A conversion factor you might find useful is 1 HPequals=746 wattsequals=0.746 kilowatts.)

Reference no: EM131605859

Questions Cloud

Calculate economic ordering quantity : What is Novelty Medical Pacemakers' current total annual inventory cost? Calculate the economic ordering quantity (EOQ).
Determine the cost of equity financing for company : Paul Sharp is CFO of Fast Rocket Inc. He tries to determine the cost of equity financing for his company.
What is the bond yield to maturity : What is the bond's yield to maturity?
What will the waccs be for each division : Suppose your firm has decided to use a divisional WACC approach to analyze projects. What will the WACCs be for each division?
Installation at municipal sewage-treatment plant : Two 180-horsepower (HP) motors are being considered for installation at a municipal sewage-treatment plant.
Assuming they file as married jointly-use standard deduction : Assuming they file as married jointly and use the standard deduction, what is Price S. Wright and May B. Wright’s 2017 tax owed?
What is the depreciation expense in year one : What is the Depreciation Expense in year one? What is the Operating Cash Flow in year two for this project?
What is the crossover rate between project : What is the Net Present Value of project E if the cost of capital is 12%? What is the Crossover Rate between Project B and C?
Cost of common equity financing using gordon model : Last year the Black Water Inc. paid dividends $2.83. Calculate the cost of common equity financing using Gordon Model.

Reviews

Write a Review

Financial Management Questions & Answers

  The various states or the federal government

Which level of government do you think should regulate the insurance industry, the various states or the federal government? Explain your reasoning.

  Budgeted the costs-profit increase

Bubba's Steakhouse has budgeted the following costs for a month in which 1,600 steak dinners will be produced and sold: Materials, $4,080; hourly labor (variable), $5,200; rent (fixed), $1,590; depreciation, $770; and other fixed costs, $470. Each st..

  Coupon bond with twelve years to maturity

What is the Macaulay duration of a 6 percent coupon bond with twelve years to maturity and a current price of $1,062.40? What is the modified duration?

  What are the after-tax cash flows for the company

What are the after-tax cash flows for the company?

  Uses the proceeds to repurchase shares

Dupuis can borrow at 9.50 percent. Dupuis currently has no debt, and the cost of equity is 15 percent. The current value of the firm is $646,000. The corporate tax rate is 30 percent. What will the value be if Dupuis borrows $217,000 and uses the pro..

  Price-product-promotion and place

One of your friends is contemplating opening a coffee shop near your college campus. She seeks your advice about size of the prospective customer base and how to market the business according to the four Ps. "Price, product, promotion, place" What st..

  Interest is computed using the discount method

Find the finance charges on an 8 percent, 18-month, single-payment loan when interest is computed using the simple interest method. Find the finance charges on the same loan when interest is computed using the discount method. Determine the APR in ea..

  What is the smallest expected loss in percentages

Raybrooks Co. stock has an annual return mean and standard deviation of 10 percent and 21 percent, respectively. Joi, Inc., stock has an annual return mean and standard deviation of 12 percent and 34 percent, respectively. What is the smallest expect..

  Explain description of the new health care service line

What is your dream? Explain Description of the new health care service line and Definitions of the four areas of the SWOT analysis.

  How long will it take him to pay off the debt

Joey realizes that he has charged too much on his credit card and has racked up $5,200 in debt. If he can pay $175 each month and the card charges 16 percent APR (compounded monthly), how long will it take him to pay off the debt?

  Calculate the value of your companys stock

Discuss Home Depot, Inc stock choice; include stock’s economic, industry, and company analysis; include some ideas about how you can calculate the value of your company’s stock,

  What is the risk-free rate

Consider the CAPM. The expected return on the market is 13%. The expected return on a stock with a beta of 1.5 is 18%. What is the risk-free rate?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd