Basics of Engineering Economy 1st Edition by Leland Blank,Anthony Tarquin

Exercise 5

Since many U.S.Navy aircraft are at or near their usual retirement age of 30 years, military officials want a precise system to assess when aircraft should be taken out of service.A computational method developed at Carnegie Mellon University maps in 3-D the microstructure of aircraft materials in their present state so that engineers can test them under different conditions of moisture, salt, dirt, etc.Military officials can then determine if an aircraft is fine, is in need of overhaul, or should be retired.If the 3-D system allows the Navy to use one airplane 2 years longer than it normally would have been used, thereby delaying the purchase of a $0 million aircraft for 2 years, what is the present worth of the assessment system at an interest rate of 15% per year?