You are a member of an engineering project team that is designing a new processing facility....

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You are a member of an engineering project team that is designing a new processing facility. Your present design task involves the portion of the system that requires pumping a slurry that is corrosive and contains abrasive particles. For final analysis and comparison, you have narrowed it down to two pump units of equal output capacity, from different manufacturers. Both will provide the same level of service, but have different useful lives and costs. Capital investment Annual expenses Electrical energy Maintenance Useful Life (years) Salvage value at end of useful life SP240 $33,200 $2165 $1100 in year 1 and increasing $500/yr thereafter 5 $0 HEPS9 $47,600 $1720 $500 in year 4 and increasing $100/yr thereafter 9 $5000 (a) If the MARR is 20%, which pump should you select (use an annual worth calculation)? (b) What would the capital cost of SP240 have to be such that the firm would be indifferent to pump selection? You are a member of an engineering project team that is designing a new processing facility. Your present design task involves the portion of the system that requires pumping a slurry that is corrosive and contains abrasive particles. For final analysis and comparison, you have narrowed it down to two pump units of equal output capacity, from different manufacturers. Both will provide the same level of service, but have different useful lives and costs. Capital investment Annual expenses Electrical energy Maintenance Useful Life (years) Salvage value at end of useful life SP240 $33,200 $2165 $1100 in year 1 and increasing $500/yr thereafter 5 $0 HEPS9 $47,600 $1720 $500 in year 4 and increasing $100/yr thereafter 9 $5000 (a) If the MARR is 20%, which pump should you select (use an annual worth calculation)? (b) What would the capital cost of SP240 have to be such that the firm would be indifferent to pump selection?

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Given SP240 HEPS9 Capital Investment today 33200 47600 Annual Expenses Electrical Energy 2165 1720 M... View the full answer