Chapter 12 Self-Study Questions

1.Salvage value of the existing accelerator today = 30% of $175k = $52.5k.

Processing per year today = 12 months/year * 21 days/mo * 12 hrs/day * $250/hr = $756k/year

Counting trade-in, installation cost of new accelerator = $250k – $52.5k = $197.5k

Processing per year = $756k/year * 1.22 = $922.3k/year

Replacing the accelerator has a PW(15) of $2461.4k – $2123.1k = $338.3k over not replacing so it is better to do the replacement.

4.The PW(16) of immediate retirement is $3040.

The PW(16) of retiring at the end of year ...

Get Return on Software: Maximizing the Return on Your Software Investment now with the O’Reilly learning platform.

O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.

Start your free trial