+1-415-670-9189
info@expertsmind.com
Should aerotron electronics buy the water filtration system
Course:- Civil Engineering
Reference No.:- EM13298444




Assignment Help
Assignment Help >> Civil Engineering

Aerotron Electronics is considering purchasing a water filtration system to assist in circuit board manufacturing. The system costs $40,000. 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 $2,000 per year. If the filtration system is not purchased, Aerotron Electronics will have to pay Bay City $12,000 per year for water purification. If the system is purchased, no water purification from Bay City will be needed. Aerotron Electronics must borrow half of the purchase price, but they cannot start repaying the loan for 2 years. The bank has agreed to three equal annual payments, with the first payment due at the end of year 2. The loan interest rate is 8 percent compounded annually. Aerotron Electronics' MARR is 10 percent compounded annually.

a.  What is this investment's external rate of return?
b.  What is the decision rule for judging the attractiveness of investments based on external rate of return?
c.  Should Aerotron Electronics buy the water filtration system?




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Civil Engineering) Materials
A piston-cylinder device initially contains 1.4 kg saturatedliquid water at 200 C. Now heat is transferred to the water until the volume quadruples, and the cylinder contains
A 0.3 meter cubed rigid tank is filled with saturated liquid water at 200 degrees Celsius. A valve at the bottom of the tan is opened and liquid is withdrawn from the tank. He
A pool player wants to bank ball B off of point A into the side pocket O. The ball has a diameter d = 2.25 in. and a coefficient of restitution e = 0.8 when colliding with t
In an oedometer test, the void ratio of a clay sample changed from 1.62 to 1.41 as the vertical effective stress imposed on the sample was increased from 100 kPa to 200 kPa.
Imagine a community for which its first roundabout is being built, something that is a relatively recent occurence even in this area.  As the Director of Public Works for the
Flow velocity is given by the function v= -5i +3j . Find the equation for the velocity potential, and the stream function ?. Sketch the equipotential line going through the or
A pressurized steel tank has a radius r=0.6m, a wall thickness t=18mm and an internal pressure p of 2.8 MPa.The steel has a modulus of elasticity E of 200 GP and a poissons ra
A hollow circular post ABC supports a load P1 = 1700 lb acting at the top. A second load P2 is uniformly distributed around the cap plate at B. The diameters and thicknesses o