Compute the net present value of each project. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round final answers to the nearest whole dollar, e.g. 5,275. For calculation purposes, use 5 decimal places as displayed in the factor table provided.)
Crane’s Custom Construction Company is considering three new projects, each requiring an equipment investment of $22,220. Each project will last for 3 years and produce the following net annual
| Year | AA | BB | CC | ||||
|---|---|---|---|---|---|---|---|
|
1 |
$7,070 | $10,100 | $13,130 | ||||
|
2 |
9,090 | 10,100 | 12,120 | ||||
|
3 |
12,120 | 10,100 | 11,110 | ||||
|
Total |
$28,280 | $30,300 | $36,360 |
The equipment’s salvage value is zero, and Crane uses straight-line
(a)
Compute each project’s payback period. (Round answers to 2 decimal places, e.g. 15.25.)
|
AA |
years | ||
|---|---|---|---|
|
BB |
years | ||
|
CC |
years |
(b)
Compute the
|
AA |
|||
|---|---|---|---|
|
BB |
|||
|
CC |
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