please I need you to show me how you solve this by excel and screen shot the com
ID: 2737092 • Letter: P
Question
please I need you to show me how you solve this by excel and screen shot the comands so I can I understand it. thanks alot
Consider an investment in a project having a first cost of $300,000, operating and maintenance costs of $45,000 per year, a profit of $65,000 per year, and an estimated disposal cost of $50,000 (toxic chemicals) at the end of 12 years. 2. a. g an interest rate of 6%, what is the present equivalent cost of the investment? Assuming an interest rate of 6%, what is the equivalent annual cost of the investment? Assuming an interest rate of 2%, what is the equivalent annual cost of the investment? C.Explanation / Answer
Answer a
Present VAlue of Operating and Maintenance cost => 45000 * PVIAF(6%,12) => 45000 * 8.38 => $377100
Present value of Toxicant => 50000 * PVIF(6%,12) => 50000 * 0.497 => $24850
Present Equivalent cost => 377100 + 24850 + 300000 => $701950
Answer b
Equivalent Annual Cost => 701950 / PVIAF(6%,12) => 701950 / 8.38 =>
Euivalent Annual Cost => $83764.9
Answer c
Present VAlue of Operating and Maintenance cost => 45000 * PVIAF(2%,12) => 45000 * 10.58 => $476100
Present value of Toxicant => 50000 * PVIF(2%,12) => 50000 * 0.788 => $39400
Present Equivalent cost => 476100+39400+300000 => $815500
Equivalent Annual Cost => 815500 / PVIAF(2%,12) => 815500 / 10.58 =>$77079.39
Equivalent Annual Cost => $77079.39
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