Question:

You are investigating the feasibility of installing a solar system at your house. You are thinking of installing 20 panels. Each panel has a capacity of 240 W. The current average cost for panels, including installation, is around $4.50/W. The solar cells are expected to operate at around 13% capacity. You will get a federal tax rebate worth 30% of the installation cost. You will also get a rebate from the state of New Jersey.

Obviously, installing the system would save you every year what you would spend on energy. Assuming an energy cost of $0.17 per kWh and that the cells operate for 25 years at 13% capacity continuously (this means that they operate 8760 hours per year) and that you consume everything that your system generates :

1. 1.DeterminetheNPVfordiscountratesbetween1%to5%withanincrementof1%(thisistheopportunitycostofyourmoneysaywhatyouwouldgetinamoneymarketaccount)
2. 2.Indecidingwhetherornottodothisprojectthestaterebateisimportant.Howmuchshouldbethestaterebatetomaketheprojectappealingtoyouineachofthecasesconsidered.
3. 3.Becausethepriceofenergyisvolatileyouarenothappywithyourpreviouscomputationsandyouwouldliketowaitoneyeartoseewherepricesgo.IfyouassumethatthePVofthesavingshaveavolatility(standarddeviation)of30%andthattheoneyearT-billis3%whatwouldbethestaterebateforeachcasecomputedthatwouldconvinceyounottowaitoneyearandinvestrightaway.
4. 4.Comparetheresultsatpoint2andpoint3

NOTE: The relationship between W and kWh is the relationship between power (kW) and energy (kWh). Thus multiplied by time. Also, 1000W=1kW.

Please answer parts 3 and 4 too. if not please don't reply to the question.