# Engineer Economic Analys – coursefighter.com

Engineer Economic Analys – coursefighter.com

• the full question in the attach file

• 2.5 points) Find the present value, P, for the following cash flows.
• (2.5 points) Star Inc. must purchase a small size milling machine. The following is known about the machine and about possible cash flows. The machine is expected to have a useful life of 8 years. The company has a MARR of 7%. Determine the NPW of the machine.
• (2.5 points) The company accountant is uncertain which of three depreciation methods the firm should use for welding equipment that costs \$150,000, and has a zero salvage value at the end of a 10-year depreciable life. Compute the depreciation schedule for the welding equipment using the methods listed:
• Straight line
• Double declining balance
• Sum-of-years’ –digits
• (2.5 points) A Petroleum company recently completed construction on a large refinery in Louisiana. The final construction cost was \$71,000,000. The refinery covers a total of 260 acres. The Expansion and Acquisition Department at the company is currently working on plans for a new refinery in Texas. The anticipated size is approximately 360 acres. If the power-sizing exponent for this type of facility is .70, what is the estimated cost of construction?

i = 12%

 p=.25 p=.50 p=.25 First cost \$40,000 \$40,000 \$40,000 Annual savings 2,000 5,000 8,000 Annual costs 12,000 8,000 6,000 Actual salvage value 4,000 5,000 6,500

Based on your analysis, which depreciation method is most profitable for the firm?