The clap chemical company needs a large insulated stainless

Assignment Help Econometrics
Reference no: EM13377938

The Clap Chemical Company needs a large insulated stainless steel tank to expand its plant. Clap has located such a tank at a recently closed brewery. The brewery has offered to sell the tank for $15,000 delivered. The price is so low that Clap believes it can sell the tank at any future time and recover its $15,000 investment.

The outside of the tank is covered with heavy insulation that requires considerable maintenance.

YEAR                                     Insulation  Maintenance Cost

0                                                  $2000

1                                                  500

2                                                  1000

3                                                  1500

4                                                   2000

5                                                  2500

a) Based on a 15% before tax MARR, what life of the insulated tank has the lowest EUAC?

b) Is it likely that the insulated tank will be replaced by another tank at the end of the period with the lowest EUAC? Explain.

Reference no: EM13377938

Questions Cloud

Calculate the price elasticity of demand for the following : calculate the price elasticity of demand for the following products and state whether demand is price elastic inelastic
A justification for job training programs is that they : a justification for job training programs is that they improve worker productivity. suppose that you are asked to
An average worker in brazil can produce an ounce of : an average worker in brazil can produce an ounce of soybeans in 20 minutes and an ounce of coffee in 60 minutes while
Felix jones a recent engineering graduate expects a : felix jones a recent engineering graduate expects a starting salary of 65000 per year. his future employer has
The clap chemical company needs a large insulated stainless : the clap chemical company needs a large insulated stainless steel tank to expand its plant. clap has located such a
Part a - tax policydiscuss whether a capital gains tax in : part a - tax policydiscuss whether a capital gains tax in your opinion would result in a more equitable tax system in
1 explain why relatively flat as opposite relatively steep : 1. explain why relatively flat as opposite relatively steep labor demand curves are more consistent with the empirical
Why are market based solutions to economic problems : why are market based solutions to economic problems preferable to others?why is the supply curve positively
Describe an ethical dilemma and its importance and : describe an ethical dilemma and its importance and relevance. identify the various stakeholders and their

Reviews

Write a Review

Econometrics Questions & Answers

  Determine the return and risk associated with the purchase

A new machine will cost $25,000. The machine is expected to last 4 years and has no salvage value. If the interest rate is 12%, determine the return and risk associated with the purchase. Probability 0.3 0.4 0.3 Annual Savings $7000 $8500 $9500

  How to install enough capacity to produce

Firm A has developed a new product and must now decide whether to install enough capacity to produce either one or two units of the product. It expects production costs (including capacity building) to be C(q) = 8q + q2 and it estimates demand for..

  Determine the annual marginal tax rates for the next 3 years

A contractor expects to have an annual taxable income of $400,000 from its regular business for the next 3 years. The contractor is considering buying a new piece of equipment that costs $115,000. The equipment falls into the MACRS seven year

  How much is jose willing to pay to join the club

Suppose Jose has a demand curve for tennis games (x) given by x = 60 3p where p is the price of one tennis game. There is a local tennis club that charges its members a fee of f dollars to join and play tennis at a price of p = 10.

  Find what is the maximum increase in the money supply

Suppose the Federal Reserve's trading desk buys $500,000 in T-bills from a securities dealer who then deposits the Fed's check in Best National Bank. Use a balance sheet to show the impact on the bank's loans.

  Will john take a dangerous job if he is offered per week

Suppose that John's preferences for wages and risk (a bad) are given by the utility function: U = W x e-Rwhere e represents the exponential function, W is the weekly wage, and R represents the type of job.

  What are the optimal markups for widgets and gadgets

Given the information below what are the optimal markups for widgets and gadgets Marginal revenue = Price(1 + 1/Price elasticity) since price is positive (always) so we can ignore that part when determining the sign of MR MR is negative if 1+1/elasti..

  Calculate the irr on home using companys insulated concrete

A typical 2,000 sq. ft. home using standard concrete forms costs $120 per square foot to construct and uses $300 per month average to heat and cool. Calculate the IRR on a home using your company's insulated concrete forms on a typical 2,000 sq. f..

  By how much will money-creating potential of banking system

Suppose in the banking system as a whole, demand deposits are equal to $80,000,000 and reserves are equal to $17,000,000 with a legal reserve ratio of 10%. by how much will the money-creating potential of the banking system

  What is the expected return of migrating to the city

Assume that the going wage in agriculture is normalized at 1. The wage in the formal urban sector is 3. The wage in the informal sector is 0.5. Additionally, 20% of working adults who live in the city are employed in the formal sector. Also, assum..

  What is the point estimate of the population variance

A random sample of 100 observations from a population has a mean of 60 and a population standard deviation of 18. a. What is the point estimate of the population mean b. What is the interval estimate of the population mean (a=.05) c. What is the poin..

  What irr will be earned on the purchased of the machine

An industrial machine costing $10,000 will produce net cash savings of $4,000 per year. The machine has a five-year useful life but must be returned to the factory for major repairs after three years of operation. These repairs cost $5,000.

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