Greyson industries is evaluating whether to invest in solar panels to provide some of the electrical needs of its main office building in Ann Arbor, Michigan. The solar panel project would cost $650,000 and would provide cost savings in its utility bills of $30,000 per year. It is anticipated that the solar panels would have a life of 20 years and would have no residual value. Read the resuirements (Click the icon to view the present value factor table.) Click the icon to view the present value annuity factor table.) (Click the icon to view the future value factor table) (Click the icon to view the future value annuity factor table.) Requirement 1. Calculate the payback period in years of the solar panel project Determine the formula, then calculate the payback period (Round your answer to two decimal places.) Payback period x * Requirements ud ma 64 cig al 1. Calculate the payback period in years of the solar panel project. 2. If the company uses a discount rate of 12%, what is the net present value of this project? 3. If the company has a rule that no projects will be undertaken that have a payback period of more than five years, would this investment be accepted? If not, what arguments could the energy manager make to try to obtain approval for the solar panel project? 4. What would you do if you were in charge of approving capital investment proposals? en Print Done i Reference - Present Value of $1 Periods 1% 2% Period 1 0.990 | 0.980 Period 2 0.980 0.961 Period 3 0.971 0.942 Period 4 0.961 0.924 Period 5 0.951 0.906 Period 6 0.9420.888 Period 7 0.933 0.871 Period 8 0.923 0.853 Period 9 0.914 0.837 Period 10 0.905 0.820 Period 110.896 0.804 Period 12 0.887 0.788 Period 13 0.879 0.773 Period 14 0.870 0.758 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% 0.971 0.962 0.9520.943 0.926 0.909 0.893 0.877 0.862 0.847 0.833 0.943 0.925 0.907 0.890 0.8570.826 0.797 0.769 0.743 0.7180.694 0.915 0.889 0.864 0.840 0.794 0.751 0.712 0.675 0.641 0.609 0.579 0.888 0.855 0.823 0.792 0.735 0.683 0.636 0.592 0.552 0.516 0.482 0.863 0.822 0.784 0.747 0.681 0.621 0.567 0.519 0.476 0.437 0.402 0.837 0.790 0.746 0.705 0.630 0.564 0.5070.4560.410 0.370 0.335 0.8130.760 0.7110.665 0.583 0.513 0.452 0.400 0.354 0.3140 279 0.789 0.731 0.677 0627 0.540 0.467 0.4040.351 0.305 0.266 0.233 0.766 0.703 0.6450.592 0.500 0.424 0.361 0.308 0.263 0.225 0.194 0.744 0.676 0.614 0.558 0.463 0.386 0.322 0.270 0.227 0.191 0.162 0.722 0.650 0.585 0.527 0.429 0.350 0.287 0.237 0.195 0.162 0.135 0.701 0.625 0.557 0.497 0.397 0.319 0.257 0.208 0.168 0.137 0.112 0.681 0.601 0.530 0.469 0.368 0.290 0.229 0.182 0.145 0.116 0.093 0 661 0.577 0.505 0.442 0.340 0263 0 205 0.160 0.125 0.099 0.078 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.735 0.6830.636 0.592 0.552 0.516 0.482 Period 5 0.951 0906 0.863 0.822 0.784 0.747 0.681 0.621 0.567 0.519 0.476 0.437 0.402 Period 6 0.9420.888 0.837 0.790 0.746 0.705 0.630 0.564 0.507 0.456 0.410 0.370 0.335 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 0.583 0.513 0.452 0.400 0.354 0.314 0.279 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.540 0.467 0.404 0.3510.305 0.266 0.233 Period 9 0.914 0.837 0.766 0.703 0.645 0.592 0.500 0.424 0.361 0.308 0.263 0225 0.194 Period 10 0.905 0.820 0.744 0.676 0.614 0.558 0.463 0.386 0.322 0.270 0.227 0.1910.162 Period 110.896 0.8040.722 0.650 0.585 0527 0.429 0.350 0.287 0.237 0.195 0.162 0.135 Period 12 0.887 0.788 0.701 0.625 0.557 0.497 0.397 0.319 0.257 0.208 0.168 0.137 0.112 Period 130.879 0.773 0.681 0.601 0.530 0.4690.368 0.290 0.229 0.182 0.145 0.116 0.093 Period 14 0.870 0.758 0.661 0.577 0.505 0.442 0.340 0.263 0.2050.160 0.125 0.099 0.078 Period 15 0.861 0.743 0.642 0.5550.481 0.417 0.315 0.239 0.183 0.1400.108 0.084 0.065 Period 200.820 0.673 0.5540.456 0.377 0.3120215 0.149 0.104 0.073 0.051 0.037 0.026 Period 25 0.780 0.610 0.478 0.375 0.295 0.233 0.146 0.092 0.059 0.038 0.024 0.0160.010 Period 30 0.742 0.552 0.412 0.308 0.231 0.174 0.099 0.057 0.033 0.0200.012 0.007 0.004 Period 400.672 0.453 0.307 0.208 0.142 0.097 0.046 0.022 0.011 0.005 0.003 0.001 0.001 LE - X Reference bl 3% 14% 0.877 1.647 2.322 2.914 3.433 16% 0.862 1.605 2.246 2.798 3.274 3.685 4.039 4.344 4.607 4.833 18% 0.847 1.566 2.174 2.690 3.127 Present Value of Annuity of $1 Periods 1% 2% 4% 5% 6% 8% 10% 12% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.9090.893 Period 2 1.970 1.942 1.913 1.886 1.859 1.833 1.783 1.736 1.690 Period 3 2.941 2.884 2.829 2.775 2.723 2673 2.577 2.487 2.402 Period 4 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3.037 Period 5 4.853 4.713 4.5804452 4.3294212 3.993 3.791 3.605 Period 6 5.795 5.601 5.417 5.2425.076 4.917 4.623 4.355 4.111 Period 7 6.728 6.472 6.230 6.002 5.786 5.5825.206 4.868 4.564 Period 8 7.652 7.325 7020 6.733 6.463 6210 5.747 5.335 4.968 Period 9 8.566 8.1627.786 7.435 7.108 6.802 6.247 5.759 5.328 Period 10 9.471 8.983 8.530 8.111 7.7227.360 6.710 6.145 5.650 Period 11 | 10.368 9.787 9.2538.760 8.3067 8877 139 6.495 5.938 Period 12 11.255 10.575 9.9549.3858.863 8.384 7.536 6.814 6.194 Period 1312.134 11 348 10.635 9.986 9.3948.853 7.904 7,1036.424 Period 14 13.004 12.106 11.296 10.563 9899 92958.244 7.367 6.628 20% 0.833 1.528 2.106 2.589 2.991 3.889 4.288 4.639 4.946 5.216 3.498 3.812 4.078 4.303 4.494 3.326 3.605 3.837 4,031 4.192 5.453 5.660 5.842 6.002 5.029 5.197 5.342 5.468 4.656 4.793 4.910 5.008 4.327 4.439 4.533 4611 2.589 2.991 3.326 3.605 3.837 4.031 4.192 Period 4 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3.037 2.914 2.798 2.690 Period 5 4.853 4.713 4.580 4.452 4.32942123.993 3.791 3.605 3.433 3.274 3.127 Period 6 5.795 5.601 5.417 5.242 5.076 4.917 4.623 4.355 4.111 3.8893.685 3.498 Period 7 6.728 6.472 6.230 6.002 5.786 5.5825.206 4.868 4.564 4.288 4.039 3.812 Period 8 7.652 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.9684.639 4.344 4,078 Period 9 8.566 8.1627.786 7.435 7.108 6.802 6.247 5.759 5.328 4.946 4.607 4.303 Period 10 9.471 8.983 8.530 8.111 7.722 7.360 6.710 6.145 5.6505.216 4.833 4.494 Period 11 10.368 9.787 9.2538.760 8.306 7.887 7.139 6.495 5.938 5.4535.029 4.656 Period 12 11.255 10.575 9.9549.385 8.8638.384 7.536 6.814 6.194 5.6605.197 4.793 Period 13 12.134 11.348 10.635 9.986 9.394 8.853 7.904 7.103 6.424 5.8425.3424.910 Period 14 13.004 12.106 11.296 10.563 9.899 9.295 8.244 7.3676.6286.002 5.468 5.008 Period 15 13.865 12.849 11.938 11.118 10.380 9.712 8.5597.6066.811 6.142 5.575 5,092 Period 20 18.046 16.351 14.877 13.590 12.462 11.470 9.818 8.514 7.4696.623 5.929 5.353 Period 25 22.023 19.523 17.413 15.622 14.094 12.783 10.675 9.077 7.8436.873 6.097 5.467 Period 30 25 808 22.396 19.600 17.292 15.372 13.765 11.2589.4278.055 7.003 6.177 5.517 Period 40 32 835 27.355 23.115 19.793 17.159 15.046 11.925 9.779 | 8.244 7.105 6.233 5.548 4.327 4.439 4.533 4.611 4.675 4.870 4.948 4.979 4.997 - X Reference Future Value of $1 Periods Period 1 Period 2 Period 3 Period 4 Period 5 1% 1.010 1.020 1.030 1.041 1051 2% 1.020 1.040 1.061 1.082 1.104 3% 1030 1.061 1.093 1.126 1.159 4% 1.040 1.082 1.125 1.170 1.217 5% 1.050 1.103 1.158 1 216 1.276 6% 1.060 1.124 1.191 1.262 1.338 8% 1.080 1.166 1.260 1.360 1.469 10% 1.100 1.210 1.331 1.464 1.611 12% 1.120 1.254 1.405 1.574 1.762 14% 1.140 1.300 1.482 1.689 1.925 16% 1.160 1 346 1.561 1.811 2.100 18% 1.180 1.392 1.643 1.939 2288 20% 1.200 1.440 1.728 2074 2.488 Period 6 Period 7 Period 8 Period 9 Period 10 1062 1.072 1.083 1.094 1.105 1.126 1.149 1.172 1.195 1.219 1.194 1.230 1.267 1.305 1.344 1.265 1.316 1.369 1.423 1.480 1.340 1.407 1.477 1.551 1.629 1.419 1.504 1.594 1.689 1.791 1.587 1.714 1.851 1.999 2 159 1.772 1.949 2.144 2.358 2.594 1.974 2.211 2.476 2.773 3.106 2.195 2.502 2.853 3.252 3.707 2436 2.826 3.278 3.803 4.411 2.700 3.185 3.759 4.435 5 234 2.986 3.583 4.300 5.160 6.192 Period 11 Period 12 Period 13 Period 14 1.116 1.127 1.138 1149 1 243 1 268 1.294 1.319 1.384 1.426 1.469 1513 1.539 1.601 1.665 1.732 1.710 1.796 1.886 1.980 1.898 2012 2.133 2261 2.332 2518 2.720 2937 2.853 3.138 3.452 3.797 3.479 3.896 4.363 4887 4.226 4,818 5.492 6.261 5.117 5.936 6.886 7988 6.176 7.288 8.599 10.147 7.430 8.916 10.699 12 839 Period 4 Period 5 1.041 1.051 1.082 1.104 1.126 1.159 1.170 1217 1.216 1.276 1.262 1.338 1.360 1.469 1.464 1.611 1.574 1.762 1.689 1.925 1.811 2.100 1.939 2.288 2.074 2.488 1.062 1.072 1.083 1.094 1.105 1.126 1.149 1.172 1.195 1.219 1.194 1.230 1.267 1.305 1.344 1.265 1.316 1.369 1.423 1.480 1.340 1.407 1.477 1.551 1.629 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 Period 14 Period 15 1.116 1.127 1.138 1.149 1.161 1.243 1.268 1.294 1.319 1.346 1.384 1.426 1.469 1.513 1.558 1.539 1.601 1.665 1.732 1.801 1.710 1.796 1.886 1980 2.079 1.419 1.587 1.772 1.974 2.195 2.436 2.700 2.986 1.504 1.714 1.949 2.211 2.502 2.826 3.185 3.583 1.594 1.851 2.144 2.476 2.853 3.278 3.759 4.300 1.689 1.999 2.358 2.773 3.252 3.803 4.435 5.160 1791 2.159 2.594 3.106 3.707 4.411 5.234 6.192 1 898 2332 2.853 3.479 4.226 5.117 6.176 7.430 2.012 2518 3.138 3.896 4.818 5.936 7.288 8.916 2.133 2.720 3.452 4.363 5492 6.886 8.599 10.699 2.261 2.937 3.797 4.887 6.261 7.988 10.147 12.839 2.397 3.172 4.177 5.474 7.138 9.266 11.974 15.407 3.207 4.661 6.727 9.646 13.743 19.461 27.393 38.338 4.292 6.848 10.83517.000 26.462 40.87462.669 95 396 5.743 10.063 17.449 29 960 50.950 85.850 143,371 237.376 10.286 21725 45.259 93 051 188.884 378.721 750 378 1.469.772 Period 20 Period 25 Period 30 Period 40 1.220 1.282 1.348 1.489 1.486 1.641 1.811 2.208 1.806 2.094 2.427 3.262 2.191 2.666 3.243 4.801 2.653 3386 4.322 7040 Periods Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 Future Value of Annuity of $1 1% 2% 3% 4 5% 6% 8% 10% 12% 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 2.010 2020 2.030 2040 2.050 2.060 2080 2.100 2.120 3.030 3.060 3.091 3.122 3.153 3.184 3.246 3,310 3.374 4060 4.122 4.184 4.246 4.310 4.375 4.506 4.641 4779 5.101 5,204 5 309 5416 5.526 5 637 5.867 6.105 6.353 6.152 6.308 6,468 6.633 6.802 6975 7.336 7716 8.115 7214 7434 7.662 7.898 8.142 8.394 8.923 9.487 10.089 8.286 8.583 8 892 9.214 9.549 9.897 10.637 11.436 12.300 9.369 9.755 10.159 10.583 11.027 11.491 12.488 13.579 14 776 10.462 10.950 11.464 12.006 12.57813 181 14.48715.93717 549 14% 1.000 2.140 3.440 4.921 6.610 16% 1.000 2.160 3.506 5.066 6.877 18% 1.000 2.180 3.572 5.215 7.154 20% 1.000 2 200 3.640 5.368 7.442 8.536 10.730 13.233 16.085 19.337 8.977 11.414 14.240 17.519 21.321 9.442 12.142 15.327 19.086 23.521 9.930 12.916 16 499 20.799 25.959 32.150 39.581 48.497 59. 196 Period 11 Period 12 Period 13 Period 14 11.567 12.169 12.808 13.486 14.207 14.972 16.645 18.531 20.655 12.683 13.412 14.192 15.026 15,917 16.870 18.977 21.384 24.133 13.809 14.680 15.618 16.627 17.713 18.882 21.495 24.523 28.029 14.94715.974 17.086 18.292 19.599 21.015 24.215 | 27 975 32 393 23.045 27 271 32.089 37581 25.733 30.850 36.786 43.672 28.755 34.931 42.219 50.818 Period 4 Period 5 8. 115 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 Period 14 Period 15 4,060 4.122 4.184 4.246 4.310 4.375 4.506 4.641 4.779 4921 5.066 5.215 5.368 5.101 5.204 5.309 5.416 5.526 5.637 5.867 6.105 6.353 6.610 6.877 7.154 7.442 6.152 6,308 6.468 6.633 6.802 6.975 7.336 7.716 8,536 8.977 9.442 9.930 7.214 7.434 7.662 7.898 8.142 8.394 8.923 9.487 10.089 10.730 11.414 12.142 12.916 8.286 8,583 8.892 9.214 9.549 9.897 10.637 11.436 12.300 13.233 14 240 15.327 16 499 9.369 9.755 10.159 10.583 11.027 11.491 12.488 13.579 14.776 16.085 17519 19.086 20.799 10.462 10.950 11.464 12.006 12.578 13.181 14.48715.937 17.549 19,337 21,321 23.521 25.959 11.567 12.169 12.808 13.486 14.207 14.972 16.645 18.531 20,655 23.045 25.733 28.755 32.150 12.683 13.412 14.192 15.026 15.917 16.870 18.977 21.384 24.133 27 271 30.850 34.931 39.581 13.809 14 680 15.618 16.627 17.713 18.882 21.495 24 523 28.029 32.089 36.786 42.219 48,497 14.94715.974 17.086 18.292 19.599 21.015 24 215 27.975 32.393 37581 43,672 50.818 59.196 16.097 17.29318.599 20.024 21.579 23.276 27.152 31.772 37.280 43.842 51.660 60.965 72.035 22.019 24.297 26.870 29.778 33.066 36.786 45.762 57 27572052 91025 115 380 146.628 186,688 28.243 32.030 36.459 41.646 47.727 54.865 73.106 98.347 133.334 181.871 249 214 342.603 471.981 34.785 40 568 47.575 56,085 66.439 79.058 113.283 164 494 241 333 356.787 530.312 790.948 1,181.882 48.886 60 402 75.401 95.026 120.800 154.762 259.057 442 593 767.091 1,342.025 2.360 757 4.163.213 7.343.858 Period 20 Period 25 Period 30 Period 40