Question
EXCEL ONLY- PLEASE POST FORMULAS AND STEP BY STEP A new project will cost $80,000 initially and will last for 7 years, at which time
EXCEL ONLY- PLEASE POST FORMULAS AND STEP BY STEP
A new project will cost $80,000 initially and will last for 7 years, at which time its salvage value will be $2,500. Annual revenues are anticipated to be $15,000 per year. The initial cost is believed to be accurate, but the estimates of annual revenue and salvage value are subject to error.
For a MARR of 12 percent/year, what values in the equation below relates Revenue (X) and Salvage (Y) for the project to be feasible using an annual worth analysis.
Also, plot a two-factor sensitivity graph (critical to be shown in Excel submission). Include a line that separates the favorable and unfavorable regions as well as a box showing the 15 percent error region.
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