Question

A city is spending ​$19.5 million on a new sewage system. The expected life of the...

A city is spending ​$19.5 million on a new sewage system. The expected life of the system is 50 ​years, and it will have no market value at the end of its life. Operating and maintenance expenses for the system are projected to average ​$0.7 million per year. If the​ city's MARR is 9​% per​ year, what is the capitalized worth of the​ system? The study period is 100 years.

Please show all work

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
A new bridge across the Cumberland River is being planned. The construction (first) cost of the...
A new bridge across the Cumberland River is being planned. The construction (first) cost of the bridge is $1,900,000 and annual upkeep is estimated to be $25,000. In addition, major maintenance work is anticipated every eight years at a cost of $350,000 per occurrence. The town government’s MARR is 8% per year. 1. For this problem, what analysis period (N) is, practically speaking, defined as forever? 2. If the bridge has an expected life of 50 years, what is the...
1. A new bridge with a 100-year life is expected to have an initial cost of...
1. A new bridge with a 100-year life is expected to have an initial cost of Birr 20 million. This bridge must be resurfaced every five years, at a cost of Birr 1 million. The annual inspection and operating costs are estimated to be Birr 50 000. Determine the present-worth cost of the bridge using the capitalized equivalent approach (i.e., take the life of the bridge as infinite). The interest rate is 10% per year, compounded annually.
"The City of Boston is considering adding new buses for its current mass-transit system that links...
"The City of Boston is considering adding new buses for its current mass-transit system that links from the Hartsfield International Airport to major city destinations on a nonstop basis. The total investment package is worth $10 million and expected to last 11 years with a $670,000 salvage value. The annual operating and maintenance costs for buses would be $1.9 million during the first year, and will grow by 8% each year over the previous year thereafter. If the system is...
A drug store is looking into the possibility of installing an automated prescription refill system to...
A drug store is looking into the possibility of installing an automated prescription refill system to increase its projected revenues by $20,000 per year over the next 5 years. Annual expenses to maintain the system are expected to be $5,000. The system will cost $50,000 and will have no market value at the end of the 5-year study period. The store’s MARR is 12% per year. a. Use the EUAW (Equivalent Uniform Annual Worth) method to evaluate this capital investment....
Aerotron Electronics is considering the purchase of a water filtration system to assist in circuit board...
Aerotron Electronics is considering the purchase of a water filtration system to assist in circuit board manufacturing. The system costs $340,000. It has an expected life of 7 years at which time its salvage value will be $7,500. Operating and maintenance expenses are estimated to be $13,000 per year. If the filtration system is not purchased, Aerotron Electronics will have to pay Bay City $38,000 per year for water purification. If the system is purchased, no water purification from Bay...
Aerotron Electronics is considering the purchase of a water filtration system to assist in circuit board...
Aerotron Electronics is considering the purchase of a water filtration system to assist in circuit board manufacturing. The system costs $200,000. It has an expected life of 7 years at which time its salvage value will be $7,500. Operating and maintenance expenses are estimated to be $20,000 per year. If the filtration system is not purchased, Aerotron Electronics will have to pay Bay City $48,000 per year for water purification. If the system is purchased, no water purification from Bay...
Aerotron Electronics is considering purchasing a water filtration system to assist in circuit board manufacturing. The...
Aerotron Electronics is considering purchasing a water filtration system to assist in circuit board manufacturing. The system costs $45,000. It has an expected life of 7 years at which time its salvage value will be $7,000. Operating and maintenance expenses are estimated to be $2,000 per year. If the filtration system is not purchased, Aerotron Electronics will have to pay Bay City $11,500 per year for water purification. If the system is purchased, no water purification from Bay City will...
Sony Corporation has invested $5.6 million in developing super-thin TVs based on new, organic light-emitting diode...
Sony Corporation has invested $5.6 million in developing super-thin TVs based on new, organic light-emitting diode technology. The company plans to market the OLED TVs in an 11-inch size and produce 27,860 units per year for the first five years. The annual production and operating cost is estimated at $350 per unit and will be sold at $400 per unit. Calculate the present worth for this investment if the study period is five years and the MARR is 2%. Please...
Ms. Child is considering the purchase of a new food packaging system. The system costs $221,358....
Ms. Child is considering the purchase of a new food packaging system. The system costs $221,358. Ms. Child plans to borrow one-third of the purchase price from a bank at 4.5% per year compounded annually. The loan will be repaid using equal, annual payments over a 7-year period. The system is expected to last 15 years and have a salvage value of $22,445 at that time. Over the 15 year period, Ms. Child expects to pay $987 per year for...
Ms. Child is considering the purchase of a new food packaging system. The system costs $76342....
Ms. Child is considering the purchase of a new food packaging system. The system costs $76342. Ms. Child plans to borrow one-third of the purchase price from a bank at 4.5% per year compounded annually. The loan will be repaid using equal, annual payments over a 7-year period. The system is expected to last 15 years and have a salvage value of $21725 at that time. Over the 15 year period, Ms. Child expects to pay $1077 per year for...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT