question 1
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Questions to consider for your entertainment.TRANSCRIPT
Question 1 Three different alternatives shown in the table below are being considered by Kal Tech Engineering systems. Assume that alternatives X and Z are replaced at the end of their lives (replaceability assumption). The NPW of alternative X is ____________.DataAlternative XAlternative YAlternative Z
Initial Cost$6,000$1,000$1,500
Uniform Annual Benefits$810$125$ 230
Useful Life in Years20Infinite10
MARR12%
$5$53.4$49.89$84.5
Question 2 A sum of $25,000 is deposited into a savings account, which pays 8% interest compounded semiannually. Equal annual withdrawals are to be made from the account, beginning 1 year from now and continuing forever. The maximum amount that can be withdrawn at the end of each year is approximately equal to ____________.$2,250$2,000$2,300$2,040
Question 3 Four different alternative designs as shown in table below are available for a public interest project. Determine using the capitalized cost approach which alternative is the most desirable one. MARR =5%Alternative XAlternative YAlternative ZDo Nothing
Initial Cost$10M$28M$5M0
Benefit/Year$1M$1.8M$1M0
Life in Years1530100
Alternative X
Alternative Y
Alternative Z
Do nothing
Question 4 A federal government contractor is considering buying a software package at a cost of $450,000. The software company will charge an annual maintenance fee of $25,000 payable at the beginning each year including the very first year. The contracting company is bidding on a four-year government contract. Thepresent worthof the software that should be included in the bid at an interest rate of 20% is ______. $550,000
$517,346
$509,050
$527,650
Question 5 A bridge in a metropolitan area is being considered at a cost of $120M. The annual maintenance cost is estimated to be $100K. A major renovation at a cost of $50M is required every 100 years. What is the capitalized cost of the bridge at an interest rate of 5%?$122M
$12.38M
$122.38M
$12M