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A public-private initiative in Texas will significantly expand the wind-generated energy through- out the state. The cash flow for one phase of the project involving

A public-private initiative in Texas will significantly expand the wind-generated energy through- out the state. The cash flow for one phase of the project involving Central Point Energy, a trans-mission utility company, is shown. Given reinvestment rate of 14% per year for excess funds and 12% for MARR, Determine:

Year

Net cash flow (1000 units)

0

480

1

220

2

-960

3

25

4

2

How many number of ROR values is expected and why?

the Return on invested capital (ROIC), also known as Composite rate of return, CRR)

Is the project economically viable?

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