1. 8.34 Kahn Instruments is considering an investment of $500,000 in a new product line. The company will make the investment only if it will result in a rate of return of 15% per year or higher. If the revenue is expected to be between $135,000 and $165,000 per year for 5 years,

(a) determine if the decision to invest is sensitive to the projected range of income using a PW analysis.

(b) If the decision is sensitive to revenue, determine the revenue per year below which the investment would not yield the 15% rate of return.