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For the following cash flow compute: a. PW(6%) Investment $1,650,000 Annual operating Cost 400,000 Annual Revenues 600,000 Operating cost will increase by $800 annually

 

For the following cash flow compute: a. PW(6%) Investment $1,650,000 Annual operating Cost 400,000 Annual Revenues 600,000 Operating cost will increase by $800 annually from the 2 year to 60year. (gradient) Salvage Value at the end of 60 year (SV=0) Investment life n360 years MARR= 6% Note: Select the must near answer to yours computations. To solve this problem (PW, IRR and ERR) you cannot use the net cash flow approach (like if you are using Excel) and them bring one to one year net to the present. (Only use net cash flow approach for Payback) You must use the formulas learned in chapter 4. Like P/G, P/F,PIA. or geometric series formula, dummy's. etc. whatever is necessary to solve the problem. $1,390,000 $1,990,350 $1,155,500 $2,196,350

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A B ABC D C x D Year Annual Revenue Annual Operating Cost Annual Cash Flow PV Factor 6 Present Value 1 600000 400000 200000 094340 188679 2 600000 400... blur-text-image

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