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A project has been selected for implementation. The net cash ow [HEP] prole associated with the project is shown below. MARE is ID percentr'year. nuII
A project has been selected for implementation. The net cash ow [HEP] prole associated with the project is shown below. MARE is ID percentr'year. \"nuII a. What is the annual wonlt of this investment? 11. What is the decision rule forjudging the attractiveness of investments based on annual worth? 1:. Is the project economically justied? Reconsider the data from Problem 4. Management has expressed some concern over the life of the project and the impact of possible earl}.I termination. As a result. you have developed additional data based on three possible salvage value scenarios. In each casel the possible salvage values progress from saunas at EDT 0 to $2., at EDT 6. Case 1 is based on a schedule provided by the vendor as shown below. Case 2 is based on agradient series decline. Case 3 is based on a geometric series decline. \fa. Determine the salvage decline rate for the gradient case. b. Determine the salvage value decline rate for the geometric case. c. Determine the annual worth for each case for each planning horizon from 1 to 6 by 1. d. Plot a graph similar to Figure 7.1 depicting your results from c
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