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A certain potential investment project is critical to a firm. The following are best or most likely estimates: $100,000 10 yr Investment; Life: Salvage value:
A certain potential investment project is critical to a firm. The following are "best" or "most likely" estimates: $100,000 10 yr Investment; Life: Salvage value: Net annual cash flow: Minimum required rate of return; $20,000 $30,000 10% It is desired to show the sensitivity of a measure of merit (net annual worth) lo variation, over a range of 50% of the expected values, in the following elements: (a) life, (b) net annual cash flow, (c) interest rate. Graph the results. To which element is the deci- sion inost sensitive
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