Johnson Thermal Products uses austenitic nickel-chromium alloys to manufacture resistance heating wire. The company is considering a new annealing-drawing process to reduce costs. If the new process will cost $3.3 million now, how much must be saved each year to recover the investment in 5 years if the company's MARR is a real 10% per year and the inflation rate is 4.3% per year? The amount to be saved each year to recover the investment is $ (Enter your answer in dollars and not in millions of dollars.)

Johnson Thermal Products uses austenitic nickel-chromium alloys to manufacture resistance heating wire. The company is considering a new annealing-drawing process to reduce costs. If the new process will cost $3.3 million now, how much must be saved each year to recover the investment in 5 years if the company's MARR is a real 10% per year and the inflation rate is 4.3% per year? The amount to be saved each year to recover the investment is $ (Enter your answer in dollars and not in millions of dollars.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

A man deposits P50,000 in a bank account at 6% compounded monthly for 5 years. If the inflation rate of 6.5% per year continues for this period, will this effectively protect the purchasing power of the original principal?
You would like to buy carcar t is currently on themarket at $85,000, but you cannot afford it right now. However, you think that youwould be able to buy it after 4 years. If the expected inflation rate as applied to the priceof this car is 6% per year, what is its expected price after 4 years?
How much must you invest exactly 5 years from now to have $500,000 in today’s buying power 20 years from now? You can invest your money at 10% per year and inflation runs 4%.
Your manager has decided to invest $4350 dollars at an annual interest rate of 8.0% to buy raw material that it is needed one of the main manufacturing processes of your company. The current price of the raw material is $4.0 per kilogram. If the annual inflation is 5.0%, how many kilograms of raw material will your manager be able to purchase in 8 years? $ What would be the actual dollars amount that will be paid in 8 years for that raw material? 2$
Today a typical family of four spends $600/month for food. If inflation occurs at the rate of 5%/year over the next 6 yr, how much should the typical family of four expect to spend for food 6 yr from now?
You would like to buy a house that is currently on themarket at $85,000, but you cannot afford it right now. However, you think that youwould be able to buy it after 5 years. If the expected inflation rate as applied to the priceof this house is 7% per year, what is its expected price after four years?
Find the real amounts (with today as the base year) corresponding to the current amounts shown below for a 4% inflation rate. (a) $400 three years from now (b) $400 three years ago (c) $10 next year (d) $350983 in 10 years from now
a man deposit P50000 in a bank account at 6% compounded monthly for 5 years. If the inflation rate of 6.5% per year continues for this period , will this effectively protect the purchasing power of the original principal?
A company is planning to invest $500,000 in a new business opportunity. The current inflation rate in the country is 1.3 % per quarter. If the company has the policy of maintaining the purchasing power of their invested dollars and also earn 10% real interest rate per year, (a) to what Future Dollars value the invested $500,000 should grow in 5 years?
1. A man deposited P25,000 in a bank with interest at 8% compounded monthly for 3 years, After 3 years, he added P12,000 at 6% compounded quarterly for 5 years with, If an inflation rate during the last 5 years is 2.5% per year, what will be his money's worth in 8 years from now in today's pesos.
8 years ago a machine cost $774000. Now, the same machine costs $1546000. The average rate of inflation per year is close to: 6.77% 13.55% 4.52% None of the given answers 9.03%
QUESTION-2 Someone calculated the-future worth of his investment in term of today's dollars. The obtained result was $/945.89s, The life of the investment is expected to be 20 years. The average annual inflation rate along this period is 7%. If it is known that the investor earns 149% per year from this investment, what is the first cost of the investment?