Standby power for pumps at water distribution booster stations can be provided b
ID: 1094229 • Letter: S
Question
Standby power for pumps at water distribution booster stations can be provided by either gasoline or diesel powered engines. The costs for the gasoline engines are as follows:
The incremental PW cash flow associated with diesel-gasoline is
0=-40,000 + 11,000(P/A,i,15) + 16,000(P/F,i,15)
Determine the following:
1)first cost of the diesel engines
2)annual m&o costs of the diesel engines
3)salvage value of the diesel engines
Gasoline First Cost $ -150,000 Annual M&O $ -41,000 Salvage Value $ 23,000 Life years 15Explanation / Answer
1) First cost of diesel engines = 150000 - 40000 = 110000
2) Annual m&o costs of diesel engine = 41000 - 11000 = 30000
3) Salvage value of diesel engines = 23000 - 16000 = 7000
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