Engineering Economics Present Worth
1. The problem statement, all variables and given/known data
Three different alternatives shown below are being considered. Assume that alternatives X and Z are replaced at the end of their lives
Alt. X Alt. Y Alt. Z
Initial Cost - 6000 1000 1500
Annual Benefits - 810 125 230
Useful Life - 20 infinite 10
MARR = 12% for all
Find the Net Present Worth for Alt. X, Alt. Y, and Alt. Z.
2. Relevant equations
capitalized cost A = iP
F = A [((1 + i)n - 1))/i]
P = A [((1 + i)n - 1))/i(1 + i)n]
3. The attempt at a solution
I found the NPW for Alt. Y
P = (125/.12) - 1000 = 41.67
I'm still stuck on X and Z.
Re: Engineering Economics Present Worth
Nevermind. One of choices was a typo so I got it right.
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