1) Final Finishing is considering 3 mutually exclusive alternatives for a new polisher. Each alternative has an expected life of 14 years and no salvage value. Polisher 1 requires an initial investment of $24,000 and provides annual benefits of $4,365. Polisher 2 requires an initial investment of $11,800 and provides annual benefits of $1,960. Polisher 3 requires an initial investment of $15,400 and provides annual benefits of $3,590. MARR is 15%/year.
What is the future worth of Polisher 1? $
What is the future worth of Polisher 2? $
What is the future worth of Polisher 3? $
2) Parker County Community College (PCCC) is trying to determine whether to use no insulation or to use insulation that is either 1 inch thick or 2 inches thick on its steam pipes. The heat loss from the pipes without insulation is expected to cost $0.70 per year per foot of pipe. A 1-inch thick insulated covering will eliminate 89% of the loss and will cost $0.35 per foot. A 2-inch thick insulated covering will eliminate 92% of the lost and will cost $0.85 per foot. PCCC Physical Plant Services estimates that there are 190,000 feet of steam pipe on campus. The PCCC Accounting Office requires a 10%/year return to justify capital expenditures. The insulation has a life expectancy of 10 years.
What is the annual worth of having no insulation? $
What is the annual worth of having 1-inch insulation? $
What is the annual worth of having 2-inch insulation? $