You Are Deciding Between Three Types of Water Heaters

question 16

Essay

You are deciding between three types of water heaters. The associated costs are shown below. At the end of year 5, the electricity and oil water heaters need to be replaced with the same model at the purchased prices. Which alternative should be selected on the basis of their future worth at an interest rate of 12% per year?
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$$\begin{array} { l | c | c | c } \text { ernative } & \text { Electricity } & \text { Gas } & \text { Oil } \\\hline \begin{array} { c } \text { ce of water } \\\text { ter }\end{array} & \$ 32,000 & \$ 27,000 & \$ 29,000 \\\hline & 2.0 & 0.57 & 0.75 \\\hline \text { l cost } & \$ 0.075 / \mathrm { kWh } & \$ 0.000009 / \mathrm { Btu } & \$ 0.000009 / \mathrm { Btu } \\\hline \begin{array} { l } \text { nual } \\\text { intenance } \\\text { ts }\end{array} & \$ 1000 & \$ 200 & \$ 500 \\\hline \text { e, years } & 5 & 10& 5\\\hline\end{array}$$ $$\begin{array} { l | c | c | c } \text { ernative } & \text { Electricity } & \text { Gas } & \text { Oil } \\\hline \begin{array} { c } \text { ce of water } \\\text { ter }\end{array} & \$ 32,000 & \$ 27,000 & \$ 29,000 \\\hline & 2.0 & 0.57 & 0.75 \\\hline \text { l cost } & \$ 0.075 / \mathrm { kWh } & \$ 0.000009 / \mathrm { Btu } & \$ 0.000009 / \mathrm { Btu } \\\hline \begin{array} { l } \text { nual } \\\text { intenance } \\\text { ts }\end{array} & \$ 1000 & \$ 200 & \$ 500 \\\hline \text { e, years } & 5 & 10& 5\\\hline\end{array}$$ Hint: The estimated annual cost of operation for gas and oil heaters equals
365 x 41045/EF x Fuel Cost per Btu and the estimated annual cost of operation for electric water heaters equals 365 x 12.03/EF x Electricity Cost per kWh.

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Definitions:

Responsiveness

The quality of reacting quickly and positively to stimuli or changes, often used in contexts ranging from individual behaviors to system performance.

Blood Pressure

The force exerted by circulating blood upon the walls of blood vessels, often measured as an indicator of cardiovascular health.

Arteriosclerosis

A condition characterized by the thickening, hardening, and loss of elasticity of the walls of arteries.

Arteries

Blood vessels that carry oxygen-rich blood away from the heart to various parts of the body.