eel is considering a plant expansion to produce austenitic, precipitation hardened, duplex, and martensitic stainless steel at is expected to cost $18 million now and another $10 million 1 year from now. If total operating costs will be $1.7 million ar starting 1 year from now, and the estimated salvage value of the plant is virtually zero, how much must the company ma ly in years 1 through 10 to recover its investment plus a return of 21% per year? mpany must make $ million annually in years 1 through 10 to recover its investment plus a return of 21% per year.

ENGR.ECONOMIC ANALYSIS
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U.S. Steel is considering a plant expansion to produce austenitic, precipitation hardened, duplex, and martensitic stainless steel round
bars that is expected to cost $18 million now and another $10 million 1 year from now. If total operating costs will be $1.7 million
per year starting 1 year from now, and the estimated salvage value of the plant is virtually zero, how much must the company make
annually in years 1 through 10 to recover its investment plus a return of 21% per year?
The company must make $
million annually in years 1 through 10 to recover its investment plus a return of 21% per year.
Transcribed Image Text:U.S. Steel is considering a plant expansion to produce austenitic, precipitation hardened, duplex, and martensitic stainless steel round bars that is expected to cost $18 million now and another $10 million 1 year from now. If total operating costs will be $1.7 million per year starting 1 year from now, and the estimated salvage value of the plant is virtually zero, how much must the company make annually in years 1 through 10 to recover its investment plus a return of 21% per year? The company must make $ million annually in years 1 through 10 to recover its investment plus a return of 21% per year.
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