Reference no: EM131970652
Question: Engineering Economic Analysis (Solve using excel)
Suppose you are buying a used car. Alternative A is an American built compact. It has an initial cost of $8900 and operating costs of $0.09/km, excluding depreciation. From re-sale statistics, you estimate the American car can be resold at the end of 3 years for $1700. Alternative B is a foreign-built Fiasco. Its intial cost is $8000, the operating cost, also excluding depreciation, is $0.08/km. How low could the resale value of the Fiasco can to provide equally economical transportation?
Assume that you will drive 12,000 km/year and you consider 8% an appropriate interest rate. Recalculate how low the resale value of the Fiasco should be to provide equally economical transportation for the following situations:
1. What is the Fiasco is more reliable than expected, so that its operating cost is $0.075/km?
2. What if you drive only 9000 km/year (Operating costs are the original values)
3. What if your interest is 6% annually
4. What if (1), (2), and (3) happened simultaneously? (This means the Fiasco operating cost is $0.075/km, you drive only 9000 km/year and your interest rate is 6% annually)
|
What is the equal payment series for given years
: What is the equal -payment series for 10 years that is equivalent to a payment series starting with $1500 at the end of first year and increasing by $150 each.
|
|
Amount that is necessary to maintain that balance
: Company policy is to maintain a minimum cash balance of $5 and borrow only the amount that is necessary to maintain that balance.
|
|
Compute the revenue for the year on a cash basis
: Revenue on the income statement was $121,560. Accounts receivable were $3,680 on January 1 and $3,500. Compute the revenue for the year on a cash basis.
|
|
What is the pre-tax cost of debt based on mm proposition
: What is the pre-tax cost of debt based on MM Proposition II with no taxes?
|
|
What is the fiasco is more reliable than expected
: What is the Fiasco is more reliable than expected, so that its operating cost is $0.075/km? What if you drive only 9000 km/year?
|
|
Calculate the revenue for the year on a cash basis
: Revenue on the income statement was $120,330. Accounts receivable were $3,680 on January 1 and $3,400. Calculate the revenue for the year on a cash basis.
|
|
Determining the balance and a bond investment
: Suppose that David has the followig assets: an automobile worth $15,000 (he originally paid $17,000 for the car), a checking account
|
|
What is the ending balance in the retained earnings account
: The retained earnings account had a beginning credit balance of $26,550. During the period. What is the ending balance in the retained earnings account?
|
|
How much money must the student repay each month
: An engineering student borrows $4000 to pay tuition for his senior year. Payments are to be made in 36 equal monthly installments, to begin the first month.
|