Eddies precision shop is insured for 700000 the present, Ask an Expert

Economics

Eddies precision shop is insured for $700,000. The present yearly insurance premium is $1.00 per $100 of coverage. A sprinkler system with an estimated life of 20 years and no salvage value can be installed for $20,000. Annual maintenance costs for the sprinkler system are $400. If the sprinkler system is installed, the system must be included in shops value for insurance purposes, but the insurance premium will reduce to $0.40 per $100 of coverage. Eddie uses a MARR of 15 percent/year. What's the present worth of this investment? Is the sprinkler system economically justified?

View complete question

Business Economics, Economics

Category:- Business Economics
Reference No.:- M91424295

Have any Question?Write your Review or question?

Related Questions in Business Economics

Find each of the following probabilities for a normal

Find each of the following probabilities for a normal distribution. (Use/round to 4 decimal places.) p ( z > 0.80) p + p ( z Please work out the steps so I can understand the formula

Electric car technology has been improving and the us shale

Electric car technology has been improving and the U.S. shale gas oil supply has been increasing. What will be the impact on the crude oil market price? What will be the impact on the gas-burning auto market price? Expla ...

While reconciling your check register to your bank

While reconciling your check register to your bank statement you notice that your check register balance is 1250.00 while your bank statement balance is 1205.00. Describe what might account for the difference between the ...

The usable lifetime of a particular electronic component is

The usable lifetime of a particular electronic component is known to follow an exponential distribution with a mean of 6.2 years. Let X = the usable lifetime of a randomly selected component. (a) The proportion of these ...

Assume that your business firm is a price taker and that

Assume that your business firm is a price taker and that the company sells widgets at $10 apiece. Your firm is maximizing profits. One of your engineers discovers the presence of a substitute input that enables you to cu ...

In a random sample ofnbsp50nbsprefrigerators the mean

In a random sample of 50 ?refrigerators, the mean repair cost was ?$146.00 and the population standard deviation is ?$17.80. Construct a 90?% confidence interval for the population mean repair cost. Interpret the results ...

If the coefficient of determination is 0738 what percentage

If the coefficient of determination is 0.738, what percentage of the data about the regression line is unexplained?

A publisher reports that 61 of their readers own a

A publisher reports that 61% of their readers own a particular make of car. a marketing executive wants to test the claim that the percentage is actually above the reported percentage. A random sample of 310 found that 6 ...

In a class there are 7 girls and 5 boys the median age of

In a class there are 7 girls and 5 boys. The median age of the 7 girls is 12 and the median age of the 5 boys is 14. Additionally, you know that there are 3 girls with age greater than 14 and 2 boys with age less than 12 ...

In a sample of phd students 80 have paid assistant-ships a

In a sample of PH.D students 80% have paid assistant-ships. A student is chosen at random from this sample. What is the probability that the student has a paid assistant-ships?

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Business Economics Expert