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6. Choose the optimal SHP for a proposed tanker, given the costs and revenues tabulated below. The owner wants to earn a yield of

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6. Choose the optimal SHP for a proposed tanker, given the costs and revenues tabulated below. The owner wants to earn a yield of (i') 18 percent. The ships are expected to last for 20 years and tax rate is 33 percent. (25P) Tanker SHP A B C D 10000 15000 20000 25000 Speed in knots Cargo: tons/year 12.8 310000 14.6 15.9 16.9 350000 380000 395000 Investment ($) 13400000 14000000 14600000 15000000 Annual Operating Cost ($) 1170000 1350000 1500000 1700000 t i' (1+i') N CR' N AAC YCR XP, CR' = ve CR = (1 + i') - 1 1-t

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