Engineering Economy



Engineering Economy

Question 1: Mutually Exclusive Alternatives

Project A1

PW= -22,000 * (P/A, 15%, 4) + 4,000(P/F, 15%, 4) + (14,000 - 7,000)

PW= - 22, 000 * (0.3503) + 4,000 * (0.2003) + 7,000

PW= - 7,706.6 + 801.2 + 7,000

PW = 94.6

Project A2

PW= -26,200 * (P/A, 15%, 10) + 5,000 * (P/F, 15%, 10) + (15,000 - 7,500)

PW= -26,200 * (0.1993) + 5,000 * (0.0493) + 7,500

PW= - 5,221.66 + 246.5 + 7,500

PW= 2,524.843

Project A2

PW= -17,000 * (P/A, 15%, 5) + 3,500 * (P/F, 15%, 5) + (12,000 - 5,800)

PW= -17,000 * (0.2983) + 3,500 * (0.1483) + 6,200

PW= - 5071.1 + ...