Question
. (20 points) A distribution company wants to implement a voice recognition distribution center . The initial investment is known and deterministic for$3,5000,000 (MACRS 5-year
. (20 points) A distribution company wants to implement a voice recognition distribution center . The initial investment is known and deterministic for$3,5000,000 (MACRS 5-year property class). However, the revenue (R), O&M (O), and salvage (S), are random according to the probability distributions shown below. The planning horizon is six years. The firm uses a MARR 12% and a tax rate of 25%. The probability distributions of the random variables are as follows: Perform after tax cash flow (ATCF) risk analysis by using 1000 replications of Monte Carlo simulation, and determine the expected present worth, the standard deviation of the present worth, and Pr(PW>0)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started