Question
DuraTech Manufacturing is evaluating a process improvement project. The estimated receipts and disbursements associated with the project are shown below. MARR is 11%/year. End of
DuraTech Manufacturing is evaluating a process improvement project. The estimated receipts and disbursements associated with the project are shown below. MARR is 11%/year.
| End of Year | Receipts | Disbursements | ||
| 0 | $0 | $4,900 | ||
| 1 | $200 | $180 | ||
| 2 | $2,100 | $350 | ||
| 3 | $3,400 | $500 | ||
| 4 | $3,200 | $1,000 | ||
| 5 | $1,600 | $1,510 |
a) what is the present worth of this investment
b) what is the decision rule for judging the attractiveness of investments based on present worth?
c) Should DuraTech implement the proposed process improvement?
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Finance In America An Unfinished Story
Authors: Kevin R. Brine, Mary Poovey
1st Edition
022650204X, 978-0226502045
