Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Q2 (40 points): For the following industrial project data Investment cost $3,000,000 Operational and maintenance cost $400,000 per year, increase 5% annually. Annual revenues by

image text in transcribed

Q2 (40 points): For the following industrial project data Investment cost $3,000,000 Operational and maintenance cost $400,000 per year, increase 5% annually. Annual revenues by selling products $700,000 for the first three years, $900,000 for year's four to six, and $1,100,000 thereafter. Note: unit selling price is $50. Net income taxes 10% Inflation rate 3% per year Discount rate (MARR) 15% per year Project estimated life time years a) Calculate the net present worth. b) Calculate the produced unit cost ($/unit). c) If the investor wants to take a loan to cover 50% of the initial investment, the bank offered him a 8% APR for 10 years repayment period. Repeat (a) taking into consideration this issue. d) How do you think the depreciation analysis could affect project analysis? Discuss it without any additional analysis. your age in years for MALES, and your father age divided by three for FEMALES

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Principles Techniques And Practices

Authors: Mustaq Ahmad, Mohd Ashraf Ali

1st Edition

8184841949, 978-8184841947

More Books

Students also viewed these Accounting questions

Question

4. Are there any disadvantages?

Answered: 1 week ago

Question

3. What are the main benefits of using more information technology?

Answered: 1 week ago

Question

start to review and develop your employability skills

Answered: 1 week ago