The data given are estimated for the project study of a certain business investment. If money is worth 10% which of the project is more desirable, using Present worth Method and determine the difference in profit from each project study. For Plan A, the initial investment is 3,500 with an annual revenue of 1,900. Annual disbursement amounts to 645 with no salvage value at the end of its life which is 4 years. For Plan B, the initial investment is 5,000, with annual revenue of 2,500. Annual disbursement is 1,383 with no salvage value at the end of its life which is 8 years.
The data given are estimated for the project study of a certain business investment. If money is worth 10% which of the project is more desirable, using Present worth Method and determine the difference in profit from each project study. For Plan A, the initial investment is 3,500 with an annual revenue of 1,900. Annual disbursement amounts to 645 with no salvage value at the end of its life which is 4 years. For Plan B, the initial investment is 5,000, with annual revenue of 2,500. Annual disbursement is 1,383 with no salvage value at the end of its life which is 8 years.
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 8P
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The data given are estimated for the project study of a certain business investment. If money is worth 10% which of the project is more desirable, using Present worth Method and determine the difference in profit from each project study. For Plan A, the initial investment is 3,500 with an annual revenue of 1,900. Annual disbursement amounts to 645 with no salvage value at the end of its life which is 4 years. For Plan B, the initial investment is 5,000, with annual revenue of 2,500. Annual disbursement is 1,383 with no salvage value at the end of its life which is 8 years.
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