Question
A company is selling products for children in Europe, generating annual revenues of $60000. Due to a new product design planned to be launched in
A company is selling products for children in Europe, generating annual revenues of $60000. Due to a new product design planned to be launched in 3 years from now, the revenues are expected to increase by $30000 each year for 4 consecutive years, after which the revenues will continue at the original level for another 4 years. Then the company is expected to close all its operations and sell all its available assets. The final selling operation is expected to generate $41000 including the building and all the machines. The operating cost of the factory is $27000 per year. If the MARR=18% answer the following:
a) What is the Future Worth of this company?
b) Is this a feasible project? Do you change your decision if MARR decreases? Explain.
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