2. As the supervisor of a facilities engineering department, you consider mobile cranes to be critical equipment. The purchase of a new medium-sized, truck-mounted crane is being evaluated. The economic estimates for the two best alternatives are shown in the following table. Alternatives A B $272,000 $346,000 28,800 19,300 6 9 $40,000 Capital investment Annual expenses" Useful life (years) Market value (at end of life) $25,000 "Excludes the cost of an operator, which is the same for both alternatives. You have selected the longest useful life (nine years) for the study period and would lease a crane for the final three years under Alternative A. On the basis of previous experience, the estimated annual leasing cost at that time will be $66,000 per year (plus the annual expenses of $28,800 per year). The MARR is 15% per year. Show that the same selection is made with d. Would leasing crane A for nine years, assuming the same costs per year as for three years, be preferred over your present selection? (E = MARR = 15%).
2. As the supervisor of a facilities engineering department, you consider mobile cranes to be critical equipment. The purchase of a new medium-sized, truck-mounted crane is being evaluated. The economic estimates for the two best alternatives are shown in the following table. Alternatives A B $272,000 $346,000 28,800 19,300 6 9 $40,000 Capital investment Annual expenses" Useful life (years) Market value (at end of life) $25,000 "Excludes the cost of an operator, which is the same for both alternatives. You have selected the longest useful life (nine years) for the study period and would lease a crane for the final three years under Alternative A. On the basis of previous experience, the estimated annual leasing cost at that time will be $66,000 per year (plus the annual expenses of $28,800 per year). The MARR is 15% per year. Show that the same selection is made with d. Would leasing crane A for nine years, assuming the same costs per year as for three years, be preferred over your present selection? (E = MARR = 15%).
Power System Analysis and Design (MindTap Course List)
6th Edition
ISBN:9781305632134
Author:J. Duncan Glover, Thomas Overbye, Mulukutla S. Sarma
Publisher:J. Duncan Glover, Thomas Overbye, Mulukutla S. Sarma
Chapter6: Power Flows
Section: Chapter Questions
Problem 6.43P
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