PIX company is considering licensing a water treatment system. The company can purchase a one-year option for P150,000 that will give it time to pilot test the process or the company can acquire the license now at a cost of P1.8M plus 25% of sales. If the company waits 1 year, the cost will increase to P1.9M plus 30% of sales. If PIX projects the sales to be PIM per year over the five-year license period. Determine the: PWnow and PW,oneyear- MARR is 15% per year
PIX company is considering licensing a water treatment system. The company can purchase a one-year option for P150,000 that will give it time to pilot test the process or the company can acquire the license now at a cost of P1.8M plus 25% of sales. If the company waits 1 year, the cost will increase to P1.9M plus 30% of sales. If PIX projects the sales to be PIM per year over the five-year license period. Determine the: PWnow and PW,oneyear- MARR is 15% per year
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![PIX company is considering licensing a water treatment system. The company can purchase a one-year option for P150,000 that will
give it time to pilot test the process or the company can acquire the license now at a cost of P1.8M plus 25% of sales. If the company
waits 1 year, the cost will increase to P1.9M plus 30% of sales. If PIX projects the sales to be P1M per year over the five-year license
period. Determine the: PWnow and PWoneyear . MARR is 15% per year
ANSWER for PWnow: Blank 1
ANSWER for PWone-yeari Blank 2](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F54e8a342-347e-42a8-a11b-e4dfc8beb592%2F1a7ea69c-b349-4404-890d-8874536f242d%2Fr56ynzg_processed.jpeg&w=3840&q=75)
Transcribed Image Text:PIX company is considering licensing a water treatment system. The company can purchase a one-year option for P150,000 that will
give it time to pilot test the process or the company can acquire the license now at a cost of P1.8M plus 25% of sales. If the company
waits 1 year, the cost will increase to P1.9M plus 30% of sales. If PIX projects the sales to be P1M per year over the five-year license
period. Determine the: PWnow and PWoneyear . MARR is 15% per year
ANSWER for PWnow: Blank 1
ANSWER for PWone-yeari Blank 2
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