An engineering project analyst is contemplating a 3-year project which will require an initial investment for equipment of $85,000. It is anticipated that, if there is no inflation, annual revenues from the project will be $60,000 and annual cash expenses will be $25,000. It is estimated that the left-over equipment will have a market value of $45,000 at the end of three years. MARR is 10%. a. Using 20% and 40% interest rates, what is the IRR of the project?  b. Determine the ERR of the project.

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Risk Management Techniques

Risk management is the procedure of recognizing, analyzing, monitoring, and preventing the risks and threatening factors of investments and business. Risks can arise from various factors including internal controls, market changes, natural disasters, and failure in productions. Risk management techniques enable entities to control and minimize the risks as well as the threatening factors of the business and it also helps to improve the business.