Question

6.1 DuckTech is planning to invest $450,000 in equipment to produce a new technology. The new technology should reduce significantly the amount of risk involved with certain types of analyses. The technology will is estimated to be superior for 8 years, however, there is some uncertainty in the size of the revenue and costs involved. Assume a MARR of 18%; The possible outcomes for revenue and costs Initial Cost $450,000 p (probability) 0.25 0.6 0.15 Annual Revenue $ 600,000 $ 900,000 $ 1,300,000 Annual Costs $ 108,000 $ 135,000 $ 156,000 Determine the PW of the project [4 points]

          6.1 DuckTech is planning to invest $450,000 in equipment to produce a new technology. The new technology should reduce significantly the amount of risk involved with certain types of analyses. The technology will is estimated to be superior for 8 years, however, there is some uncertainty in the size of the revenue and costs involved. Assume a MARR of 18%; The possible outcomes for revenue and costs
Initial Cost
$450,000
p (probability)
0.25
0.6
0.15
Annual Revenue $
600,000 $
900,000 $
1,300,000
Annual Costs $
108,000 $
135,000 $
156,000
Determine the PW of the project [4 points]

6.1 DuckTech is planning to invest 450,000 in equipment to produce a new technology. The new technology should reduce significantly the amount of risk involved with certain types of analyses. The technology will is estimated to be superior for 8 years, however, there is some uncertainty in the size of the revenue and costs involved. Assume a MARR of 18%; The possible outcomes for revenue and costs
Initial Cost450,000
p (probability)
0.25
0.6
0.15
Annual Revenue 600,000
900,000 1,300,000
Annual Costs
108,000 135,000
156,000
Determine the PW of the project [4 points]

Added by Daniel P.

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