Appendix A 259PW = – 20000 + 3500(P|A,10%,10) – 500(P|A,10%,10)
PW = – 20000 + 3500(6.1446) – 500(6.1446)
PW = – 20000.00 + 21506.10 – 3072.30 = – $1566.20
Decision: PW<0 (-$1566.20<0.0); therefore, the economizer is not attrac-
tive.
Example 38
If the economizer from Example 37 has a salvage value of $5000 at the
end of 10 years, is the investment attractive?
Using present worth as the measure of worth:
PW = – 20000 + 3500*(P|A,10%,10)
- 500(P|A,10%,10) + 5000(P|F,10%,10)
PW = – 20000 + 3500(6.1446) – 500(6.1446) + 5000*(0.3855)
PW = – 20000.00 + 21506.10 – 3072.30 + 1927.50 = $361.30
Decision: PW≥0 ($361.30≥0.0); therefore, the economizer is now attrac-
tive.
A.11 References
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Fuller, S.K. and S.R. Petersen, 1994, NISTIR 5165: Life-Cycle Costing Workshop for Energy
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Fuller, S.K. and S.R. Petersen, 1995, NIST Handbook 135: Life-Cycle Costing Manual for
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