use excel to solve 11.02-PR002 You have been asked to perform a sensitivity analysis on a company's plan to modemize its facilities to determine the impact of possible errors in estimating the net annual savings. The initial investment in the modemnization is $30,000. The expected net annual savings are $13,000. The salvage value is $7,000 after a planning horizon of 7 years. MARR is 12% per year. Determine if the modernization is economically attractive based on the initial estimates and an annual worth (AW) analysis. Determine the AW if the net annual savings change by the following percentages from the initial estimate: -80%, -60%, -40%, -20 %, +20%, +40%. Determine the percentage change in net annual savings that causes a reversal in the decision regarding the attractiveness of the project.

Five machines were originally estimated to have useful life of twelve years. If sold now, each can be sold for P5,500. The annual operating costs for each are one operator at P22.00 a day, 300 days a year; a yearly energy utilization is 6,000 kw-hr at P0.50 per kw-hr; upkeep including spare parts are estimated P700 a year. Taxes and insurance are 7% of first cost. The machine has the same capacity as the fivbe machines and is now available at an estimated first cost including installation of P80, 000. Sinking fund method is used at 15% in computation od depreciation. Will you recommend replacementif money is worth 20% to a company?

Your company is considering the introduction of a new product line. The initial investment required for this project is $500,000, and annual maintenance costs are anticipated to be $45,000. Annual operating costs will be directly proportional to the level of production at $8.50 per unit, and each unit of product can be sold for $65. If the MARR is 15% and the project has a life of 5 years, what is the minimum annual production level for which the project is economically viable? The equipment can be sold for $80,000 at the end of five years.

Maxx International is considering one of two forklifts trucks for its assembly plant. Truck A costs $15,000 and requires $3,000 monthly in operating expenses. It will have a salvage value of $5,000 at the end of its three-year service life. Tuck B costs $20,000 but requires only $2,000 annually in operating expenses; its service life is 4 years; at which time, its expected salvage value will be $8,000. The MARR is 10%. Assuming that the trucks are needed for 12 years and that no significant changes are expected in the future price and functional capacity each truck, select the most economical truck based on AE analysis.   Fill in the blanks:     a. Firm's MARR for truck A ? .........................................................   b  First Cost for truck A? .........................................................    First cost for truck B? ............................................................   c  Monthly opening costs for truck A ................................     Monthly…