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]