Problem 2 Biosys water engineering Inc. plan to construct water purification plant in Kalona Iowa, to supply portable water to 200,000 Iowa homes. Biosys will spend $0.56 billion in constructing the plant and $255000 per year in operating it. If a salvage, value of 20% of the initial cost is estimated at the end of the project (possibly for the equipment and other disposable items). Biosys intends to run the project for 10 years before they transfer the operation to the county government. A complete overhaul of the plant will be conducted at the end of year 6 and 9 at an extra cost of $75200 and 105000 respectively. Considering an interest rate of 8% per year: a) The engineering economy symbols and their value for each option. b) Construct the Cash flow diagram c) Calculate the Present Worth of the Cash flow Estimates Problem 1 The cost of a biomedical image scanning machine is 45000 with an estimated annual maintenance cost of $2500. The machine is projected to save $15000 in direct labor cost annually. Biomedical Analytics Inc. the company who purchased the machine plans to sell it 6 years from now at a price of $8500. a) Draw the cash flow diagram b) Estimate the present worth of the machine at an estimated MARR of 15 % per year. c) Determine the Rate of Return (ROR) if staring with two initial guesses of 18% and 20%