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  {
   "cells": [
    {
     "cell_type": "heading",
     "level": 1,
     "metadata": {},
     "source": [
      "Chapter 27: Economics and Finance"
     ]
    },
    {
     "cell_type": "heading",
     "level": 3,
     "metadata": {},
     "source": [
      "ILLUSTRATIVE EXAMPLE 27.5, Page number: 575"
     ]
    },
    {
     "cell_type": "code",
     "collapsed": false,
     "input": [
      "\n",
      "#Variable declaration:\n",
      "i = 0.03375                     #Rate of interest (%)\n",
      "n = 9                           #Years to the end of life (yr)\n",
      "P = 60000                       #Cost of exchanger ($)\n",
      "L = 500                         #Salvage value ($)\n",
      "x = 5                           #Time after 5 years (yr)\n",
      "\n",
      "#Calculation:\n",
      "SFDF = i/((1+i)**n-1)           #Sinking fund depreciation factor\n",
      "UAP = (P-L)*SFDF                #Uniform annual payment ($)\n",
      "B = P-((P-L)/n)*x               #Appraisal value after 5 years ($)\n",
      "\n",
      "#Result:\n",
      "print \"1. The uniform annual payment made into the fund at the of the year is : $\",round(UAP),\" .\"\n",
      "print \"2. The appraisal value of the exchanger at the end of the fifth year is : $\",round(B),\" .\""
     ],
     "language": "python",
     "metadata": {},
     "outputs": [
      {
       "output_type": "stream",
       "stream": "stdout",
       "text": [
        "1. The uniform annual payment made into the fund at the of the year is : $ 5768.0  .\n",
        "2. The appraisal value of the exchanger at the end of the fifth year is : $ 26945.0  .\n"
       ]
      }
     ],
     "prompt_number": 6
    },
    {
     "cell_type": "heading",
     "level": 3,
     "metadata": {},
     "source": [
      "ILLUSTRATIVE EXAMPLE 27.6, Page number: 576"
     ]
    },
    {
     "cell_type": "code",
     "collapsed": false,
     "input": [
      "\n",
      "\n",
      "from __future__ import division\n",
      "\n",
      "#Variable declaration:\n",
      "C = 150000                      #Capital cost ($)\n",
      "i = 7/100                       #Interest rate\n",
      "n = 5                           #Time (yr)\n",
      "OC = 15000                      #Operating cost ($)\n",
      "A = 75000                       #Annual cost for the old process ($)\n",
      "\n",
      "#Calculation:\n",
      "CRF = (i*(1+i)**n)/((1+i)**n-1) #Capital recovery factor\n",
      "IC = CRF*C                      #Initial cost ($)\n",
      "AC = IC+OC                      #Total annualized cost ($)\n",
      "\n",
      "#Result:\n",
      "print \"The annualized cost for the new heating system is : $\",round(AC),\" .\"\n",
      "if (AC<A):\n",
      "    print \"Since this cost is lower than the annual cost of $75,000 for the old process, the proposed plan should be implemented.\"\n",
      "else :\n",
      "    print \"Since this cost is higher than the annual cost of $75,000 for the old process, the proposed plan should not be implemented.\""
     ],
     "language": "python",
     "metadata": {},
     "outputs": [
      {
       "output_type": "stream",
       "stream": "stdout",
       "text": [
        "The annualized cost for the new heating system is : $ 51584.0  .\n",
        "Since this cost is lower than the annual cost of $75,000 for the old process, the proposed plan should be implemented.\n"
       ]
      }
     ],
     "prompt_number": 7
    },
    {
     "cell_type": "heading",
     "level": 3,
     "metadata": {},
     "source": [
      "ILLUSTRATIVE EXAMPLE 27.7, Page number: 577"
     ]
    },
    {
     "cell_type": "code",
     "collapsed": false,
     "input": [
      "\n",
      "from __future__ import division\n",
      "\n",
      "#Variable declaration:\n",
      "i = 12/100                          #Intersest rate\n",
      "n = 12                              #Lifetime period (yr)\n",
      "CC = 2625000                        #Capital cost ($)\n",
      "IC = 1575000                        #Installation cost ($)\n",
      "#From table 27.3:\n",
      "Ic1 = 2000000                       #Income credit for double pipe ($/yr)\n",
      "Ic2 = 2500000                       #Income credit for Shell-and-tube ($/yr)\n",
      "AC1 = 1728000                       #Total annual cost for double pipe ($/yr)\n",
      "AC2 = 2080000                       #Total annual cost for Shell-and-tube ($/yr)\n",
      "\n",
      "#Calculation:\n",
      "CRF = i/(1-(1+i)**-n)               #Capital recovery factor\n",
      "DPc = (CC+IC)*CRF                   #Annual capital and installation costs for the DP unit ($/yr)\n",
      "STc = (CC+IC)*CRF                   #Annual capital and installation costs for the ST unit ($/yr)\n",
      "DPp = Ic1-AC1                       #Profit for the DP unit ($/yr)\n",
      "STp = Ic2-AC2                       #Profit for the ST unit ($/yr)\n",
      "\n",
      "#Result:\n",
      "print \"The profit for the shell-and-tube unit is : $\",round(DPp),\"/yr .\"\n",
      "print \"The profit for the double pipe unit is : $\",round(STp),\"/yr .\"\n",
      "if (STp>DPp):\n",
      "    print \"A shell-and-tube heat exchanger should therefore be selected based on the above economic analysis.\"\n",
      "else :\n",
      "    print \"A double pipe heat exchanger should therefore be selected based on the above economic analysis.\""
     ],
     "language": "python",
     "metadata": {},
     "outputs": [
      {
       "output_type": "stream",
       "stream": "stdout",
       "text": [
        "The profit for the shell-and-tube unit is : $ 272000.0 /yr .\n",
        "The profit for the double pipe unit is : $ 420000.0 /yr .\n",
        "A shell-and-tube heat exchanger should therefore be selected based on the above economic analysis.\n"
       ]
      }
     ],
     "prompt_number": 8
    },
    {
     "cell_type": "heading",
     "level": 3,
     "metadata": {},
     "source": [
      "ILLUSTRATIVE EXAMPLE 27.8, Page number: 579"
     ]
    },
    {
     "cell_type": "code",
     "collapsed": false,
     "input": [
      "\n",
      "\n",
      "from __future__ import division\n",
      "from math import log\n",
      "\n",
      "#Variable declaration:\n",
      "m = 50000                       #Mass flowrate of the organic fluid (lb/h)\n",
      "cP = 0.6                        #The heat capacity of the organic liquid (Btu/lb.\u00b0F)\n",
      "T1 = 150                        #Initial temperature of organic fluid (\u00b0F)\n",
      "T2 = 330                        #Final temperature of organic fluid (\u00b0F)\n",
      "Ts1 = 358                       #Saturation temperature for 150 psia (\u00b0F)\n",
      "Ts2 = 417                       #Saturation temperature for 300 psia (\u00b0F)\n",
      "L1 = 863.6                      #Latent heat for 150 psia (Btu/lb)\n",
      "L2 = 809                        #Latent heat for 300 psia (Btu/lb)\n",
      "c1 = 5.20/1000                  #Cost for 150 psia ($/lb)\n",
      "c2 = 5.75/1000                  #Cost for 300 psia ($/lb)\n",
      "CI1 = 230                       #Cost index in 1998 \n",
      "CI2 = 360                       #Cost index in 2011\n",
      "IF = 3.29                       #Installation factor\n",
      "PF1 = 1.15                      #Pressure factors for 100 to 200 psig\n",
      "PF2 = 1.20                      #Pressure factors for 200 to 300 psig\n",
      "OP = 90/100                     #Plant on-stream operation factor\n",
      "h = 365*24                      #Hours in a year (h)\n",
      "\n",
      "#Calculation:\n",
      "Q = m*cP*(T2-T1)                #Overall heta duty (Btu/h)\n",
      "DT1 = Ts1-T1                    #Temperature driving force 1 for 150 psia (\u00b0F)\n",
      "DT2 = Ts1-T2                    #Temperature driving force 2 for 150 psia (\u00b0F)\n",
      "LMTD1 = (DT1-DT2)/log(DT1/DT2)  #Log-mean temperature difference for 150 psia (\u00b0F)\n",
      "DT3 = Ts2-T1                    #Temperature driving force 1 for 300 psia (\u00b0F)\n",
      "DT4 = Ts2-T2                    #Temperature driving force 2 for 300 psia (\u00b0F)\n",
      "LMTD2 = (DT3-DT4)/log(DT3/DT4)  #Log-mean temperature difference for 1300 psia (\u00b0F)\n",
      "A1 = Q/(138*LMTD1)              #Required heat transfer area for 150 psia (ft^2)\n",
      "A2 = Q/(138*LMTD2)              #Required heat transfer area for 300 psia (ft^2)\n",
      "BC1 = 117*A1**0.65              #Base cost for 150 psia ($)\n",
      "BC2 = 117*A2**0.65              #Base cost for 13000 psia ($)\n",
      "C1 = BC1*(CI2/CI1)*IF*PF1       #Capital cost for 150 psia ($)\n",
      "C2 = BC2*(CI2/CI1)*IF*PF2       #Capital cost for 300 psia ($)\n",
      "S1 = Q*(h*OP)/L1                #Steam requirement for 150 psia (lb/yr)\n",
      "S2 = Q*(h*OP)/L2                #Steam requirement for 300 psia (lb/yr)\n",
      "SC1 = S1*c1                     #Annual steam cost for 150 psia ($/yr)\n",
      "SC2 = S2*c2                     #Annual steam cost for 300 psia ($/yr)\n",
      "\n",
      "#Result:\n",
      "print \"1. The capital cost for 150 psia is : $\",round(C1,-3),\" .\"\n",
      "print \"   The capital cost for 300 psia is : $\",round(C2,-3),\" .\"\n",
      "print \"2. The annual steam cost for 150 psia is : $\",round(SC1,-3),\"/yr .\"\n",
      "print \"   The annual steam cost for 300 psia is : $\",round(SC2,-3),\"/yr .\"\n",
      "if (C1<C2 and SC1>SC2):\n",
      "    print \"The 300-psia exchanger costs less to purchase and install, but it costs more to operate. Choosing the more expensive, 150-psia exchanger is the obvious choice.\"\n",
      "elif (C1>C2 and SC1<SC2):\n",
      "    print \"The 150-psia exchanger costs less to purchase and install, but it costs more to operate. Choosing the more expensive, 300-psia exchanger is the obvious choice.\""
     ],
     "language": "python",
     "metadata": {},
     "outputs": [
      {
       "output_type": "stream",
       "stream": "stdout",
       "text": [
        "1. The capital cost for 150 psia is : $ 36000.0  .\n",
        "   The capital cost for 300 psia is : $ 26000.0  .\n",
        "2. The annual steam cost for 150 psia is : $ 256000.0 /yr .\n",
        "   The annual steam cost for 300 psia is : $ 303000.0 /yr .\n",
        "The 150-psia exchanger costs less to purchase and install, but it costs more to operate. Choosing the more expensive, 300-psia exchanger is the obvious choice.\n"
       ]
      }
     ],
     "prompt_number": 9
    },
    {
     "cell_type": "heading",
     "level": 3,
     "metadata": {},
     "source": [
      "ILLUSTRATIVE EXAMPLE 27.9, Page number: 581"
     ]
    },
    {
     "cell_type": "code",
     "collapsed": false,
     "input": [
      "\n",
      "\n",
      "from __future__ import division\n",
      "from sympy import symbols,solve\n",
      "from scipy.optimize import fsolve\n",
      "\n",
      "#Variable declaration:\n",
      "TCC_TB = 2500000                   #Total capital cost ($)\n",
      "R_TB = 3600000                     #R_TBevenue generated from the facility ($)\n",
      "AOC_TB = 1200000                   #Annual operating costs ($)\n",
      "TCC_FB = 3500000                   #Total capital cost ($)\n",
      "R_FB = 5300000                     #R_TBevenue generated from the facility ($)\n",
      "AOC_FB = 1400000                   #Annual operating costs ($)\n",
      "n = 10                          \t#Time of facility (yr)\n",
      "\n",
      "#Calculation:\n",
      "D = 0.1*TCC_TB                     #Depriciation ($)\n",
      "WC = 0.1*TCC_TB                    #Working capital ($)\n",
      "TI = R_TB-AOC_TB-D                 #Taxable income ($)\n",
      "IT = 0.5*TI                        #Income tax to be paid ($)\n",
      "A = R_TB-AOC_TB-IT                 #After-tax cash flow ($)\n",
      "def eqTB(i):\n",
      "\tx = (((1+i)**n-1)/(i*(1+i)**n))*A + (1/(1+i)**n)*WC    #Equation for computing rate of return for TB unit\n",
      "\ty = WC + 0.5*TCC_TB + 0.5*TCC_TB*(1+i)**1              #Equation for computing rate of return for TB unit\n",
      "\treturn x-y\n",
      "iTB = round(fsolve(eqTB,0.8)*100,1) #Rate of return for TB unit (%)\n",
      "\n",
      "D = 0.1*TCC_FB                     #Depriciation ($)\n",
      "WC = 0.1*TCC_FB                    #Working capital ($)\n",
      "TI = R_FB-AOC_FB-D                 #Taxable income ($)\n",
      "IT = 0.5*TI                        #Income tax to be paid ($)\n",
      "A = R_FB-AOC_FB-IT                 #After-tax cash flow ($)\n",
      "\n",
      "def eqFB(i):\n",
      "\tx = (((1+i)**n-1)/(i*(1+i)**n))*A + (1/(1+i)**n)*WC    #Equation for computing rate of return for FB unit\n",
      "\ty = WC + 0.5*TCC_FB + 0.5*TCC_FB*(1+i)**1              #Equation for computing rate of return for FB unit\n",
      "\treturn x-y\n",
      "iFB = round(fsolve(eqFB,0.8)*100,1) #Rate of return for FB unit (%)\n",
      "\n",
      "#Results:\n",
      "print \"The rate of return for TB unit is:\",round(iTB),\" %.\"\n",
      "print \"The rate of return for FB unit is:\",round(iFB,1),\" %.\""
     ],
     "language": "python",
     "metadata": {},
     "outputs": [
      {
       "output_type": "stream",
       "stream": "stdout",
       "text": [
        "The rate of return for TB unit is: 40.0  %.\n",
        "The rate of return for FB unit is: 44.8  %.\n"
       ]
      }
     ],
     "prompt_number": 1
    },
    {
     "cell_type": "heading",
     "level": 3,
     "metadata": {},
     "source": [
      "ILLUSTRATIVE EXAMPLE 27.10, Page number: 582"
     ]
    },
    {
     "cell_type": "code",
     "collapsed": false,
     "input": [
      "\n",
      "\n",
      "#Variable declaration:\n",
      "f = 100000                        #Flow rate of flue gas (acfm)\n",
      "i = 0.1                           #Interest rate\n",
      "#From table 27.4:\n",
      "#For finned preheater:\n",
      "ac1 = 3.1                         #Equipment cost ($/acfm)\n",
      "ac2 = 0.8                         #Installation cost ($/acfm)\n",
      "ac3 = 0.06                        #Operating cost ($/acfm-yr)\n",
      "ac4 = 14000                       #Maintenance cost ($/yr)\n",
      "an = 20                           #Lifetime (yr)\n",
      "#For 4-pass preheater:\n",
      "bc1 = 1.9                         #Equipment cost ($/acfm)\n",
      "bc2 = 1.4                         #Installation cost ($/acfm)\n",
      "bc3 = 0.06                        #Operating cost for ($/acfm-yr)\n",
      "bc4 = 28000                       #Maintenance cost ($/yr)\n",
      "bn = 15                           #Lifetime of (yr)\n",
      "#For 2-pass preheater:\n",
      "cc1 = 2.5                         #Equipment cost ($/acfm)\n",
      "cc2 = 1.0                         #Installation cost ($/acfm)\n",
      "cc3 = 0.095                       #Operating cost for ($/acfm-yr)\n",
      "cc4 = 9500                        #Maintenance cost for ($/yr)\n",
      "cn = 20                           #Lifetime of (yr)\n",
      "\n",
      "#Calculation:\n",
      "#For Finned preheater:\n",
      "aEC = f*ac1                        #Total equipment cost ($)\n",
      "aIC = f*ac2                        #Total installation cost ($)\n",
      "aOC = f*ac3                        #Total operating cost ($)\n",
      "aMC = f*ac4                        #Total maintenance cost ($)\n",
      "aCRF = (i*(1+i)**an)/((1+i)**an-1) #Capital recovery factor\n",
      "aAEC = aEC*aCRF                    #Equipment annual cost ($/yr)\n",
      "aAIC = aIC*aCRF                    #Installation annual cost($/yr)\n",
      "aAOC = ac3*f                       #Annual operating cost ($)\n",
      "aAMC = ac4                         #Annual maintenance cost ($)\n",
      "aTAC = aAEC+aAIC+aAOC+aAMC         #Total annual cost ($)\n",
      "\n",
      "#For 4-pass preheater:\n",
      "bEC = f*bc1                        #Total equipment cost ($)\n",
      "bIC = f*bc2                        #Total installation cost ($)\n",
      "bOC = f*bc3                        #Total operating cost ($)\n",
      "bMC = f*bc4                        #Total maintenance cost ($)\n",
      "bCRF = (i*(1+i)**bn)/((1+i)**bn-1) #Capital recovery factor\n",
      "bAEC = bEC*bCRF                    #Equipment annual cost ($/yr)\n",
      "bAIC = bIC*bCRF                    #Installation annual cost($/yr)\n",
      "bAOC = bc3*f                       #Annual operating cost ($)\n",
      "bAMC = bc4                         #Annual maintenance cost ($)\n",
      "bTAC = bAEC+bAIC+bAOC+bAMC         #Total annual cost ($)\n",
      "#For 2-pass preheater:\n",
      "cEC = f*cc1                        #Total equipment cost ($)\n",
      "cIC = f*cc2                        #Total installation cost ($)\n",
      "cOC = f*cc3                        #Total operating cost ($)\n",
      "cMC = f*cc4                        #Total maintenance cost ($)\n",
      "cCRF = (i*(1+i)**cn)/((1+i)**cn-1) #Capital recovery factor\n",
      "cAEC = cEC*cCRF                    #Equipment annual cost ($/yr)\n",
      "cAIC = cIC*cCRF                    #Installation annual cost($/yr)\n",
      "cAOC = cc3*f                       #Annual operating cost ($)\n",
      "cAMC = cc4                         #Annual maintenance cost ($)\n",
      "cTAC = cAEC+cAIC+cAOC+cAMC         #Total annual cost ($)\n",
      "\n",
      "#Result:\n",
      "print \"Total annual cost for finned preheater is : $\",round(aTAC),\" .\"\n",
      "print \"Total annual cost for 4-pass preheater is : $\",round(bTAC),\" .\"\n",
      "print \"Total annual cost for 2-pass preheater is : $\",round(cTAC),\" .\"\n",
      "if (cTAC<aTAC and cTAC<bTAC):\n",
      "    print \"According to the analysis, the 2-pass exchanger is the most economically attractive device since the annual cost is the lowest.\"\n",
      "elif (bTAC<aTAC and bTAC<cTAC):\n",
      "    print \"According to the analysis, the 4-pass exchanger is the most economically attractive device since the annual cost is the lowest.\"\n",
      "elif (aTAC<cTAC and aTAC<bTAC):\n",
      "    print \"According to the analysis, the finned exchanger is the most economically attractive device since the annual cost is the lowest.\""
     ],
     "language": "python",
     "metadata": {},
     "outputs": [
      {
       "output_type": "stream",
       "stream": "stdout",
       "text": [
        "Total annual cost for finned preheater is : $ 65809.0  .\n",
        "Total annual cost for 4-pass preheater is : $ 77386.0  .\n",
        "Total annual cost for 2-pass preheater is : $ 60111.0  .\n",
        "According to the analysis, the 2-pass exchanger is the most economically attractive device since the annual cost is the lowest.\n"
       ]
      }
     ],
     "prompt_number": 11
    },
    {
     "cell_type": "heading",
     "level": 3,
     "metadata": {},
     "source": [
      "ILLUSTRATIVE EXAMPLE 27.12, Page number: 584"
     ]
    },
    {
     "cell_type": "code",
     "collapsed": false,
     "input": [
      "\n",
      "from __future__ import division\n",
      "from numpy import roots\n",
      "from math import sqrt\n",
      "\n",
      "#Variable declaration:\n",
      "TH = 500                        #Hot stream temperature at exchanger 1 (\u00b0F)\n",
      "tc = 100                        #Cold stream temperature at exchanger 2 (\u00b0F)\n",
      "A = 10                          #Constant A\n",
      "B1 = 100000                     #Constant B1\n",
      "B2 = 4000                       #Constant B2\n",
      "B3 = 400000                     #Constant B3\n",
      "\n",
      "#Calculations:\n",
      "#It forms equation fo form t^2 - t(Th-tc) +tcTH +B/A\n",
      "t1 = roots([1, -(TH+tc),(tc*TH + B1/A) ]); #Roots\n",
      "tmax1 = TH - sqrt(B1/A)         #Upon maximising profit\n",
      "t2 = roots([1, -(TH+tc),(tc*TH + B2/A) ]); #Roots\n",
      "tmax2 = TH - sqrt(B2/A)         #Upon maximising profit\n",
      "t3 = roots([1, -(TH+tc),(tc*TH + B3/A) ]); #Roots\n",
      "tmax3 = TH - sqrt(B3/A)         #Upon maximising profit\n",
      "\n",
      "#Results:\n",
      "print 'tBE for case 1: ',round(t1[0]),'\u00b0F',round(t1[1]),'\u00b0F'\n",
      "print 'tmax1:', round(tmax1),'\u00b0F'\n",
      "print 'tBE for case 2: ',round(t2[0]),'\u00b0F',round(t2[1]),'\u00b0F'\n",
      "print 'tmax1:', round(tmax2),'\u00b0F'\n",
      "print 'tBE for case 1: ',round(t3[0]),'\u00b0F',round(t3[1]),'\u00b0F'\n",
      "print 'tmax1:', round(tmax3),'\u00b0F'"
     ],
     "language": "python",
     "metadata": {},
     "outputs": [
      {
       "output_type": "stream",
       "stream": "stdout",
       "text": [
        "tBE for case 1:  473.0 \u00b0F 127.0 \u00b0F\n",
        "tmax1: 400.0 \u00b0F\n",
        "tBE for case 2:  499.0 \u00b0F 101.0 \u00b0F\n",
        "tmax1: 480.0 \u00b0F\n",
        "tBE for case 1:  300.0 \u00b0F 300.0 \u00b0F\n",
        "tmax1: 300.0 \u00b0F\n"
       ]
      }
     ],
     "prompt_number": 14
    },
    {
     "cell_type": "heading",
     "level": 3,
     "metadata": {},
     "source": [
      "ILLUSTRATIVE EXAMPLE 27.15, Page number: 588"
     ]
    },
    {
     "cell_type": "code",
     "collapsed": false,
     "input": [
      "\n",
      "\n",
      "from __future__ import division\n",
      "from scipy.optimize import fmin_cobyla as optimize\n",
      "\n",
      "#Key:\n",
      "#f(x) : Objective Function\n",
      "#ci(x)'s : Constraints\n",
      "\n",
      "#Variable Declaration:\n",
      "def f(x):\t\n",
      "    return -1.70*x[0] - 2*x[1]\n",
      "\n",
      "def c1(x):\n",
      "    return 8000 - x[0]\n",
      "\n",
      "def c2(x):\n",
      "    return 6000 - x[1]\n",
      "\n",
      "def c3(x):\n",
      "    return 12000 - 0.75*x[0] - 0.40*x[1]\n",
      "\n",
      "def c4(x):\n",
      "    return 6000 - 0.60*x[0] - 0.25*x[1]\n",
      "\n",
      "def c5(x):\n",
      "    return x[0]\n",
      "\n",
      "def c6(x):\n",
      "    return x[1]\n",
      "\n",
      "#Calculation\n",
      "X = optimize(f,[7000,6000],[c1,c2,c3,c4,c5,c6], disp = 0)\n",
      "\n",
      "#Result:\n",
      "print \"Maximum Profit is $\",-f(X), \"/day or $\", -365*f(X), \"/year\""
     ],
     "language": "python",
     "metadata": {},
     "outputs": [
      {
       "output_type": "stream",
       "stream": "stdout",
       "text": [
        "Maximum Profit is $ 24750.0 /day or $ 9033750.0 /year\n"
       ]
      }
     ],
     "prompt_number": 4
    }
   ],
   "metadata": {}
  }
 ]
}