The most possible values of an investment project are as follows: First cost, $ 300,000 Annual operating cost, $ 10,000 Annual benefit, $ 120,000 Salvage value, $ 80,000 Life, year 30 MARR per year 15% The most uncertain parameters are annual operating cost and annual benefit. Perform a multiparameter sensitivity analysis and write your conclusions. Consider the cash flow given. Calculate the payback period with time value. Calculate the B/C ratios based on both PW and AW.
The most possible values of an investment project are as follows: First cost, $ 300,000 Annual operating cost, $ 10,000 Annual benefit, $ 120,000 Salvage value, $ 80,000 Life, year 30 MARR per year 15% The most uncertain parameters are annual operating cost and annual benefit. Perform a multiparameter sensitivity analysis and write your conclusions. Consider the cash flow given. Calculate the payback period with time value. Calculate the B/C ratios based on both PW and AW.
Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter11: Cash Flow Estimation And Risk Analysis
Section: Chapter Questions
Problem 7MC: Calculate the project cash flows for each year. Based on these cash flows and the average project...
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The most possible values of an investment project are as follows:
First cost, $ |
300,000 |
Annual operating cost, $ |
10,000 |
Annual benefit, $ |
120,000 |
Salvage value, $ |
80,000 |
Life, year |
30 |
MARR per year |
15% |
The most uncertain parameters are annual operating cost and annual benefit. Perform a multiparameter sensitivity analysis and write your conclusions.
Consider the cash flow given.
- Calculate the payback period with time value.
- Calculate the B/C ratios based on both PW and AW.
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