12/27/23, 10:57 AM Review Test Submission: Quiz 3 – (Summer_2023_GENG360_...
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Review Test Submission: Quiz 3
(Summer_2023_GENG360_30750_L01) Engineering Economics L01 Course Content ررقملا ىوتحم
Review Test Submission: Quiz 3
User Mohammed Al-Suwaidi
Course (Summer_2023_GENG360_30750_L01) Engineering Economics L01
Test Quiz 3
Started 7/20/23 5:21 PM
Submitted 7/20/23 5:39 PM
Status Completed
Attempt Score3 out of 4 points
Time Elapsed18 minutes out of 20 minutes
Question 1
First cost, $ −800,000
Replacement cost, year 2, $ −300,000
AOC, $/year −950,000
Salvage value, $ 250,000
Life, years 4
Interest rate 10%
Airodyne Wind, Inc. has wind tunnels that can op- erate vertically or horizontally for
evaluating the effects of air flo w on a component’s PCB response and reliability. The
company expects to build a new tunnel that will be outfitted with multiple sen- sor
ports. For the estimates below, calculate the equivalent annual cost of the project.
Question 2
Sales of bottled water in the United States totaled 34.0 gallons per person in 2014.
Evian, a high-quality natural spring water, costs about 60¢ per bottle, while a local
brand of purified municipal water may cost only 25¢ per bottle. On aver age, a local
municipal water utility may provide drinkable tap water for $2.90 per 1000 gallons. If
the average person drinks two bottles of water per day or uses 5 gallons per day to
obtain the same amount of water from the tap, what are the present worth values per
person for 1 year of drinking tap water versus bottled water using (a) Evian, and (b)
local-brand bottled water? Choose all the sets of equations used for comparison.
My Institution Courses Community Content Collection Services
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Mohammed Al-Suwaidi 30 12/27/23, 10:57 AM Review Test Submission: Quiz 3 – (Summer_2023_GENG360_...
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Wednesday, December 27, 2023 10:57:34 AM AST
Use an interest rate of 6% per year, compounded monthly, and 30 days per month.
Question 3
Round Knife Straight Knife
First cost, $ −250,000 −170,000
AOC, $/year −31,000 −35,000
Overhaul in year 2, $ — −26,000
Salvage value, $ 40,000 10,000
Life, years 6 4
An international textile company’s North America Division must decide which type of
fabric cutting machines it will use—straight knife or round knife. The estimates are
summarized below. Compare them on the basis of annual worths values at i = 10%
per year.
Question 4
Oil from a specific type of marine micr oalgae can be converted into biodiesel that may
serve as an alternate transportable fuel for automobiles and trucks. If lined ponds are
used to grow the algae, the construction cost is $13 million and the M&O cost is
estimated at $2.1 million per year. Alternatively, if long plastic tubes are used for
growing the algae, the initial cost will be higher at $18 million, but less contamination
will render the M&O cost lower at $0.41 million per year. At an interest rate of 10%
per year and a 5-year project period, how do we compare them in equations? Choose
them all.
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