Griffin Industries is evaluating investing in solar panels to provide some of the electrical needs of its

Question:

Griffin Industries is evaluating investing in solar panels to provide some of the electrical needs of its main office building in Orlando, Florida. The solar panel project would cost $ 650,000 and would provide cost savings in its utility bills of $ 45,000 per year. It is anticipated that the solar panels would have a life of 15 years and would have no residual value.

Requirements
1. Calculate the in years of the solar panel project.
2. If the company uses a of 12%, what is the of this project?
3. If the company has a rule that no projects will be undertaken that have a of more than five years, would this investment be accepted? If not, what arguments could the energy manager make to try to obtain approval for the solar panel project?

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