Question

Compact fluorescent lamps (CFLs) have become required in recent years, but do they make financial sense? Suppose a typical 60-watt incandescent lightbulb costs $.35 and lasts for 1,000 hours. A 15-watt CFL, which provides the same light, costs $2.90 and lasts for 12,000 hours. A kilowatt-hour is 1,000 watts for 1 hour. Suppose you have a residence with a lot of incandescent bulbs that are used on average 500 hours a year. The average bulb will be about halfway through its life, so it will have 500 hours remaining (and you can’t tell which bulbs are older or newer). |

If you require a 9 percent return |

Answer #1

The CFL bulb wil last for 12000/500 = 24 years

so for equal comparison, from next year, every year one has to spend $0.35 in addition to electricity cost (100 hours life / 500 use per year)

Now, let cost of each KwH be x

so on using incandecent bulb, we get electricity cost in a year = 60*500*x/1000 = 30x

For CFL bulb, we get, = 15*500*x/1000 = 7.5x

Y0 | Y1 | Y2 | Y3 | Y4 | Y24 | ||||

Incandecent Bulb | -30x | -30x | -30x | -30x | -30x | ||||

-0.35 | -0.35 | (no need to buy at Y24) | |||||||

CFL Bulb | -7.5x | -7.5x | -7.5x | -7.5x | -7.5x | ||||

-2.9 |

Discounting all by 9% and bringing NPV to 0 at Y) gives,

x= $0.006, so at 0.6 cents per KwH it makes sense to use CFL bulb

Compact fluorescent lamps (CFLs) have become required in recent
years, but do they make financial sense? Suppose a typical 60-watt
incandescent lightbulb costs $.47 and lasts for 1,000 hours. A
15-watt CFL, which provides the same light, costs $3.50 and lasts
for 12,000 hours. A kilowatt-hour is 1,000 watts for 1 hour.
Suppose you have a residence with a lot of incandescent bulbs that
are used on average 500 hours a year. The average bulb will be
about halfway through...

Compact fluorescent lamps (CFL) have become required in recent
years, but do they make financial sense? Suppose a typical 60-watt
incandescent lightbuld costs $.45 and lasts for 1,000 hours. A
15-Watt CFL, which provides the same light cast $3.40 and lasts for
12,000 hours. A kilowatt-hour of electricity costs $ .121, which is
about the national average. A Kilowatt-hour is 1,000 watts for 1
hour. If you require a 10 percent return and use a light fixture
500 hours per...

Compact fluorescent lamps (CFL) have become required in recent
years, but do they make financial sense? Suppose a typical 60-watt
incandescent lightbuld costs $.45 and lasts for 1,000 hours. A
15-Watt CFL, which provides the same light cast $3.40 and lasts for
12,000 hours. A kilowatt-hour of electricity costs $ .121, which is
about the national average. A Kilowatt-hour is 1,000 watts for 1
hour. If you require a 10 percent return and use a light fixture
500 hours per...

Light emitting diode (LED) light bulbs have become required in
recent years, but do they make financial sense? Suppose a typical
60-watt incandescent light bulb costs $.55 and lasts for 1,000
hours. A 15-watt LED, which provides the same light, costs $3.90
and lasts for 12,000 hours. A kilowatt-hour is 1,000 watts for 1
hour. Suppose you have a residence with a lot of incandescent bulbs
that are used on average 500 hours a year. The average bulb will be...

Light emitting diode (LED) light bulbs have become required in
recent years, but do they make financial sense? Suppose a typical
60-watt incandescent light bulb costs $.55 and lasts for 1,000
hours. A 15-watt LED, which provides the same light, costs $3.90
and lasts for 12,000 hours. A kilowatt-hour is 1,000 watts for 1
hour. Suppose you have a residence with a lot of incandescent bulbs
that are used on average 500 hours a year. The average bulb will be...

Light emitting diode (LED) light bulbs have become required in
recent years, but do they make financial sense? Suppose a typical
60-watt incandescent light bulb costs $.55 and lasts for 1,000
hours. A 15-watt LED, which provides the same light, costs $3.90
and lasts for 12,000 hours. A kilowatt-hour is 1,000 watts for 1
hour. Suppose you have a residence with a lot of incandescent bulbs
that are used on average 500 hours a year. The average bulb will be...

Light emitting diode (LEDs) light bulbs have become required in
recent years, but do they make financial sense? Suppose a typical
60-watt incandescent light bulb costs $.51 and lasts for 1,000
hours. A 15-watt LED, which provides the same light, costs $3.70
and lasts for 12,000 hours. A kilowatt hour of electricity costs
$.127. A kilowatt-hour is 1,000 watts for 1 hour. However,
electricity costs actually vary quite a bit depending on location
and user type. An industrial user in...

Light-emitting diode (LED) light bulbs have become required in
recent years, but do they make financial sense? Suppose a typical
60-watt incandescent bulb costs $.45 and lasts for 1,000 hours. A
7-watt LED, which provides the same light, costs $2.25 and lasts
for 40,000 hours. A kilowatt-hour of electricity costs $.121, which
is about the national average. A kilowatt-hour is 1,000 watts for 1
hour. However, electricity costs actually vary quite a bit
depending on location and user type (you...

Compact fluorescent bulbs are much more efficient at producing
light than are ordinary incandescent bulbs. They initially cost
much more, but last far longer and use much less electricity.
According to one study of these bulbs, a compact bulb that produces
as much light as a 100 W W incandescent bulb uses only 23.0 W W of
power. The compact bulb lasts 10000 hours, on the average, and
costs $ $ 11.00, whereas the incandescent bulb costs only $ $...

Compact fluorescent bulbs are much more efficient at producing
light than are ordinary incandescent bulbs. They initially cost
much more, but last far longer and use much less electricity.
According to one study of these bulbs, a compact bulb that produces
as much light as a 100 W incandescent bulb uses only 23.0 W of
power. The compact bulb lasts 10000 hours, on the average, and
costs $ 11.00, whereas the incandescent bulb costs only $ 0.76, but
lasts just...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 4 minutes ago

asked 7 minutes ago

asked 11 minutes ago

asked 15 minutes ago

asked 17 minutes ago

asked 38 minutes ago

asked 45 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago