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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
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
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