Company ABC is considering investing in a project whose initial cost is $186000. It saves $42000 in the first year, increasing by $5600 each year thereafter. The salvage value of the project is $13200 at the end of year 7. The cost of operating and maintenance in the first year is $3400, increasing by 3% each year thereafter. The company wants to see if the project is worth to be invested in. To help ABC to decide, you should find the present worth (PW) of the project. The company's MARR is 13%.

Company ABC is considering investing in a project whose initial cost is $186000. It saves $42000 in the first year, increasing by $5600 each year thereafter. The salvage value of the project is $13200 at the end of year 7. The cost of operating and maintenance in the first year is $3400, increasing by 3% each year thereafter. The company wants to see if the project is worth to be invested in. To help ABC to decide, you should find the present worth (PW) of the project. The company's MARR is 13%.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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