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Parameter Initial Estimate Sensitivity Initial Investment $15,000 None Net Annual Receipts $2,500 -30%, 0%, +30% Project Life 10 years |-20%, 0%, +20% Salvage Value $500 |-50%, 0%, +50% MARR 15% рer year none

Parameter Initial Estimate Sensitivity Initial Investment $15,000 None Net Annual Receipts $2,500 -30%, 0%, +30% Project Life 10 years |-20%, 0%, +20% Salvage Value $500 |-50%, 0%, +50% MARR 15% рer year none

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Based on a present worth measure of worth, complete a multi-parameter sensitivity analysis that examines all possible combinations of the estimates. Initial estimates of the parameters for an investment are given below. You wish to do a multiparameter sensitivity analysis based on the sensitivities shown. AW is the preferred measure of worth. a. How many values of AW need to be calculated? b. Determine the AW values. 

Parameter Initial Estimate Sensitivity Initial Investment $15,000 None Net Annual Receipts $2,500 -30%, 0%, +30% Project Life 10 years |-20%, 0%, +20% Salvage Value $500 |-50%, 0%, +50% MARR 15% рer year none
Transcribed Image Text:Parameter Initial Estimate Sensitivity Initial Investment $15,000 None Net Annual Receipts $2,500 -30%, 0%, +30% Project Life 10 years |-20%, 0%, +20% Salvage Value $500 |-50%, 0%, +50% MARR 15% рer year none
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