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Please don't copy other answers
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answerhappygod
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Please don't copy other answers
Please don't copy other answers
Question 2 [Total 15 marks] A retrofitted heating system is being considered for an office building. The system can be purchased and installed for $502,000, and it will save an estimated 102,000 kilowatt-hours (kWh) of electric year over a 6-year period. A kilowatt-hour of electricity costs $1.164. power each The market value (MV) of the system will be $8,200 at the end of six years, and the annual operating and maintenance expenses (O&M) for the system are $ 5,200. MARR is 15% per year. (a) Use the conventional benefit-cost (B/C ratio) for Present Worth method to make a recommendation. (i) Compute the conventional B/C ratio. Round your answer to 2 decimal places. (ii) Should this system be purchased? Why? (b) Use the modified benefit-cost (B/C ratio) for Present Worth method to make a recommendation. (i) Compute the modified B/C ratio. Round your answer to 2 decimal places. (ii) Should this system be purchased? Why? (c) Assume that the electricity costs will increase at the inflation rate of 3% per year. (i) Compute the conventional B/C ratio. Round your answer to 2 decimal places. (ii) Should this system be purchased? Why?
Question 2 [Total 15 marks] A retrofitted heating system is being considered for an office building. The system can be purchased and installed for $502,000, and it will save an estimated 102,000 kilowatt-hours (kWh) of electric year over a 6-year period. A kilowatt-hour of electricity costs $1.164. power each The market value (MV) of the system will be $8,200 at the end of six years, and the annual operating and maintenance expenses (O&M) for the system are $ 5,200. MARR is 15% per year. (a) Use the conventional benefit-cost (B/C ratio) for Present Worth method to make a recommendation. (i) Compute the conventional B/C ratio. Round your answer to 2 decimal places. (ii) Should this system be purchased? Why? (b) Use the modified benefit-cost (B/C ratio) for Present Worth method to make a recommendation. (i) Compute the modified B/C ratio. Round your answer to 2 decimal places. (ii) Should this system be purchased? Why? (c) Assume that the electricity costs will increase at the inflation rate of 3% per year. (i) Compute the conventional B/C ratio. Round your answer to 2 decimal places. (ii) Should this system be purchased? Why?
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