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:

Adultery

A voluntary sexual relationship between a married person and someone other than their lawful spouse.

Sexual Relations

Interactions between individuals that involve sexual activity or the expression of sexual feelings and desires.

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Scientists who study humans, their ancestors, and related primates, focusing on cultural, social, and biological aspects.

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Concepts, perceptions, or practices that are agreed upon by a society and can vary significantly from one culture to another.