With the given information please calculate NPV, NPW, EUAW, and IRR for each alternative. The interest rate is 15% Alternate2.3Initial Cost (P/A)$4,150,000.00 $ 4,698,438.00 $ 15,596,875.00Total Net Annual Savings$ 952,905.00 $ 1,202,894.00 $ 2,818,450.00Total Annual Maintenance $2,481,295.00 $ 2,231,307.00 $615,750.00Estimated Salvage Value$ 415,000.00 $328,891.00 $779,844.00Useful Life102040Calculate the NPVvCalculate the NPWCalculate EUAWCalculate IRR

Three alternatives are given: Alternatives 1 2 3 Initial Cost (P/A) $4,150,000 $4,698,438…

Answered: With the given information please…

Business

Economics

With the given information please calculate NPV, NPW, EUAW, and IRR for each alternative. The interest rate is 15%

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

With the given information please calculate NPV, NPW, EUAW, and IRR for each alternative. The interest rate is 15%

Alternate
2.
3
Initial Cost (P/A)
$4,150,000.00 $ 4,698,438.00 $ 15,596,875.00
Total Net Annual Savings
$ 952,905.00 $ 1,202,894.00 $ 2,818,450.00
Total Annual Maintenance $2,481,295.00 $ 2,231,307.00 $
615,750.00
Estimated Salvage Value
$ 415,000.00 $
328,891.00 $
779,844.00
Useful Life
10
20
40
Calculate the NPVv
Calculate the NPW
Calculate EUAW
Calculate IRR

Definition Definition Calculation used to evaluate the investment and financing decisions that involve cash flows occurring over multiple periods. NPV is calculated as the difference between the present value of cash inflow and cash outflow. NPV is used for capital budgeting and investment planning as well as to compare similar investment alternatives.

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