Question
The acceptance or refusal of a new project will depend on its Net Present Wort calculated from the combination of parameters and variables. Three hundred
The acceptance or refusal of a new project will depend on its Net Present Wort calculated from the combination of parameters and variables. Three hundred simulations (calculations of NPW were performed to determine the viability of the project. The three project parameters are: MARR = 10% Life = 5 years Initial cost = $60,000 The three variables are: Salvage value (See Table below for values) Annual operating costs (See Table below for values) Annual revenue (See Table below for values)
55. Using the information from Tables 1 and 2, which salvage value would be used in the 5th simulation of the projects Net Present Worth calculation? a) 5,000; b) $10,000 56. Using the information from Tables 1 and 2, which dollar value of annual operating cost value would be used in the 5th simulation of the projects Net Present Worth calculation? a) 5,000; b) 6,000; c) 7,000 57. Using the information from Tables 1 and 2, which dollar value of annual revenue would be used in the 5th simulation of the projects Net Present Worth calculation? a) 10,000; b) 15,000; c) 20,000; d) 25,000
The answers are bold(as shown above), could you show step by step how to get the bold answer?
Table 1 Variables and values aAnnual Revenue Salvage value AnnualAn Operating Cost $5,000 $10,000 $5,000 $6,000 $7,000 $10,000 $15,000 $20,000 $25,000Step by Step Solution
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