4. In 5 years, $18,000 will be needed topay for a building renovation. In order togenerate this sum, a sinking fund consistingof three annual payments is establishednow. No further payments will be made afterthe third year. What payments are mostnearly necessary if money is worth 15% peryear? 5. A replacement electric motor is beingconsidered for purchase. It is capable ofproviding 200 HP. The pertinent data are asfollows.cost = $3200electrical efficiency = 0.85maintenance cost per year = $50life expectancy = 14 yearssalvage value after 14 years = $0The motor is used for 400 hours/rs/year and0.04/kW·hthe cost of electricity is $0.04/(1 HP = 0.746 kW). What is most nearlythe effective annual cost using an interestrate of 10%?

First, calculate the annual electricity cost:1. Convert HP to kW: 200 HP * 0.746 kW/HP = 149.2 kW2.…

Answered: 4. In 5 years, $18,000 will be needed…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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4. In 5 years, $18,000 will be needed to pay for a building renovation. In order to generate this sum, a sinking fund consisting of three annual payments is established now. No further payments will be made after the third year. What payments are most nearly necessary if money is worth 15% per year?
Are the following cash flow diagrams economically equivalent if the interest rate is 8% per year? The left-hand diagram's discounted value at the EOY 0 is __ M. Please don't use excel and please show your work.
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Give typing answer with explanation and conclusion Calculate the Present worth of the following cash flow. Consider 6% annual interest rate, compounded semiannually. 0=2000 1=3000 2=1000 3=1500 4=2000 5=2500 6=3000 answers... a. 48837 b.45349 c.29980 d.50736

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