Basis of a rate of return analysis

Assignment Help Business Economics
Reference no: EM13837730

A mechanical engineer is considering two robots for improving materials handling in the production of rigid shaft couplings that mate dissimilar drive components. Robot X has a first cost of $84,000, an annual maintenance and operation (M&O) cost of $31,000, a $40,000 salvage value, and will improve net revenues by $96,000 per year. Robot Y has a first cost of $146,000, an annual M&O cost of $28,000, a $47,000 salvage value, and will increase net revenues by $119,000 per year. Which one should be selected on the basis of a rate of return analysis if the company’s MARR is 15% per year? Use a three-year study period.

Use Excel to create a table and solve the problem.

Reference no: EM13837730

Questions Cloud

What is the recessionary spending gap : Assume that Costa Rica has leakages from its macro economy so that only 80% of every dollar spent there is spent again there. What is the recessionary spending gap, or the proper amount of spending "medicine" to inject to achieve full employment unde..
Short supply an accountant most likely : If a machine cost $50,000 initially and is expected to last for 20 years but is worth $60,000 after one year because it is in short supply, an accountant most likely would say that:
Find where and when the two stones will meet. : Find where and when the two stones will meet.
Project risk management-case study : Tony and his team identified some risks during the first month of the Recreation and Wellness Intranet Project. However, all they did was document the risks in a list.
Basis of a rate of return analysis : A mechanical engineer is considering two robots for improving materials handling in the production of rigid shaft couplings that mate dissimilar drive components. Robot X has a first cost of $84,000, an annual maintenance and operation (M&O) cost of ..
What rate of return per year did the company make : A company that manufactures brushless blowers invested $650,000 in an automated quality control system for blower housings. The resultant savings was $160,000 per year for 5 years. If the equipment had a salvage value of $50,000, what rate of return ..
Calculate the perpetual equivalent annual cost : Calculate the perpetual equivalent annual cost of $5,000,000 in year 0, $2,000,000 in year 10, and $100,000 in years 11 through infinity. The interest rate is 10% per year.
Constant returns to scale are associated with : Constant returns to scale are associated with a:
What is meant by sufficient appropriate audit evidence : Explain what is meant by sufficient appropriate audit evidence. Discuss what you understand by reliability of audit evidence and how the reliability of audit evidence may be influenced.

Reviews

Write a Review

 

Business Economics Questions & Answers

  Think the elements of style

How important do you think the elements of style (spacing, font choice, other document design features) when it comes to drafting? Why?

  Catching red stubble immediately cover their costs

The average price of red stubble is about $8 per kilo also the fisher people's revenues for catching red stubble immediately cover their costs.

  The estimated regression equation

The estimated regression equation is:

  Explain carver memorial hospital surgeons

Explain Carver Memorial Hospital's surgeons have a new procedure that they think will decrease the time.

  What was price elasticity of demand for domino pizza

As a result, price of Domino's pizzas fell from $8 a pie to $2 a pie following week. Quantity of pizzas demanded soared following week from 1 pie an hour to 100 pies an hour. What was price elasticity of demand for Domino's pizza.

  Effort to estimating the natural rate of unemployment

Economists have devoted a lot of effort to estimating the natural rate of unemployment in particular countries at particular times. Is this a useless academic exercise, or are there good reasons to want to know this number? Explain.

  Grade point average

Suppose at Columbia University, grade point average (GPA) and SAT scores are related by the conditional expectation

  Ordering electronic component from three different supplier

Benson manufacturing company is considering ordering electronic components from three different suppliers. The supplier may differ in terms of quality in that the percentage of defective components may differ among the suppliers. To evaluate the prop..

  What is the rate of output that maximizes zzz

Its demand curve can be written as P = 160 - Q and its short run total cost curve is equal to TC = 1000 + Q^2. What is the rate of output that maximizes ZZZ, Inc.'s short run profits?

  Uses to exercise some control over the fed

Why was the Federal Reserve System set up with twelve regional Federal Reserve Banks rather than one central bank, as in other countries? What is the primary tool that Congress uses to exercise some control over the Fed?

  Assume which the market for avocados perfectly competitive

Assume which the market for avocados is perfectly competitive. The typical agribusiness firm is earning positive economic profit in the short-run equilibrium.

  Native americans who decide to stay tribe native land

Considers the choices of Native Americans who decide to stay on their tribe native land or reservation also those who select to relocate to a city.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd