6. 6.32 A biotech company is considering two processes for isolating DNA material. The incremental cash flows between the two alternatives, J and S, have an incremental rate of return that is less than 40%, which is the MARR of the company. However, the company CEO prefers the more expensive process S. She believes the company can implement cost controls to reduce the annual operating cost of the more expensive process, alternative S. How much of a reduction in AOC in $

per year is necessary for Δi* to equal the MARR? Solve using factors first, then a single-cell function coupled with the GOAL SEEK tool.

Table Summary: Table divided into 2 columns summarizes incremental cash flow for a period of 3 years. The first column shows the Year and the second column showing Incremental Cash Flow, S -J, in dollars.

Year Incremental Cash Flow (S – J), $

Year Incremental Cash Flow (S – J), $
0 –900,000 1 400,000 2 400,000 3 400,000