Q.1A power plant operator is considering an investment in increased efficiency of their plant that costs $1.2million and lasts for ten years, during which time it will save $250,000/year. The investment has no salvage value. The plant has a MARR of 13%. Is the investment viable?

Q.2A municipality is considering an investment in a small renewable energy power plant with the following parameters. The cost is $360,000 and the output averages 50kW year-round. The price paid for electricity at the plant gate is $0.039/kWh. The investment is to be evaluated over a 25-year time horizon, and the expected salvage value at the end of the project is $20,000. The MARR is 6%.

(a)Calculate the NPV of this investment. Is it financially attractive?

(b)Calculate the operating credit per kWh which the government would need to give to the investment in order to make it break even financially. Express your answer to the nearest 1/1000^th of dollars.

Q.3An electric utility investment has a capital cost of $60million, a term of 8 years, and an annuity of $16million. What is the Capital Recovery Factor (CRF) for the investment?

Q.4An energy project requires an investment in year zero of $8million, and has an investment horizon of ten years and a MARR of 7%. If the annuities in years 1 10 are as shown in the table, what is the NPV?

Year	Annuity
1	1480271
2	1165194
3	1190591
4	1286144
5	1318457
6	973862
7	1108239
8	1468544
9	1105048
10	851322