SHOW EACH STEP USING EXCEL $-$

For the exercises below, create an Excel model to analyze the problem.

A company needs to replace its fleet of service vehicles. The company is considering two

options: conventional gasoline$-$powered vans, or fully electric vans. The company has

collected data on the capital and maintenance costs, reliability and service life of the vehicles

as shown in the table below. The company$$s MARR is $15\%.$

Gasoline EV

Purchase Cost $$50,000$ $$80,000$

Annual Maintenance $$5,000$ $$2,500$

Annual Fuel $$7,500$ $$3,000$

Service Life Probability Service Life Probability

$55\%52\%$

$610\%65\%$

$725\%710\%$

$835\%825\%$

$920\%950\%$

$105\%108\%$

a$)(5$ Points$)$ What is the expected value of the present worth and expected value of the standard deviation of each option?

b$)(5$ Points$)$ Which option should be chosen, and why?

c$)(5$ Points$)$ If the company$$s MARR is $20\%,$ which option would they choose and why?

d$)(5$ Points$)$ What value of the MARR makes the company indifferent between choosing gasoline or electric vehicles?